While SP Tulsian says he won‘t be surprised if the stock moves up 10 percent after company announces its results, Misal Singh says the company may take a hit on its topline from incremental payouts.
The Supreme Court on Monday declared all captive coal blocks allocated since 1993 as illegal.
Misal Singh says if the election results are perceived to be favourable, L&T could see earnings upgrade of 10-15 percent in 2016, which in turn implies that the stock should at least be up by about 20 percent from a one year perspective.
Religare Capital Markets‘ Misal Singh feels that the rally in BHEL‘s stocks in September was probably on the back of positive reforms in the power sector. The company is battling structural problems, he says.
Concern could come in on the valuation side which is a function of how generally the market and the macro economy evolve from current levels. Comparing the last six-seven years, margins are close to the bottom level. So scope for disappointment is minimal from these levels.
Misal Singh, Director- Institutional Research, Religare Capital Markets Limited thinks the order inflow guidance of 20 percent given by L&T is a bit aggressive.
In an interview to CNBC-TV18, Misal Singh of Religare Capital Markets reviewed the second quarter financial performance of integrated power plant equipment manufacturer BHEL and electric engineering company Havells India.
As concerns over availability of coal looms large, BHEL has been shunned off by investors. Most brokerages feel that its order book is at risk of cancellation or deferment due to coal shortage.