Siyaram Silk Mills may test Rs 952: Mayuresh Joshi

Mayuresh Joshi, Vice President - Institution at Angel Broking told CNBC-TV18, "Banco Products (India) is the market leader probably in the radiator segment and the gasket business is where the company has a niche. So 80 percent of its domestic sales probably is coming from the CV cycle. We have seen CV cycle turn. So if you look at SIAM estimates and industry reports, over the next five-six years, you might see 11-15 percent volume growth specifically for the CV industry."

"In exports, it has got good market share gains and that accounts for 35 percent. If you look at the balance sheet for Banco, we are expecting the net debt to come down to Rs 88 crore over the next couple of years, the cash flows to improve drastically which would improve debt return ratio. So the REOs/ROCs would greatly improve and so could the margins of the company going forward," he said.

"Clearly, our take is that in terms of topline growth, Banco should exhibit 15-20 percent topline growth to Rs 1,550 crore. The bottomline should grow anywhere between 12 percent and 15 percent. On valuations, Banco is currently trading on 7.6 time FY16 estimated earnings. We estimate Banco to report probably an EPS of Rs 18 and if you assign a forward multiple of 10, our take is that Banco should arrive at a target price of around Rs 182 over the next 12-15 months."

He further said, "For Siyaram Silk Mills, if you look at the industry profile and if you compare Siyaram with the other players like Arvind or Raymond, it is available at very cheap valuation. If you look at the brands including Siyaram, Hampstead and Oxemberg, these brands within themselves are market leaders. So if you look at their earnings trajectory as well, our take is that the topline should grow anywhere between 17 percent and 18 percent over the next two years to Rs 1,850-1,875 crore. So bottomline should grow at 32 percent somewhere in the range of Rs 111 crore to Rs 115 crore."