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Market OutlookMay 25, 2012
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Market OutlookMay 25, 2012
Dealers Diary
The domestic markets are expected to sideways tracking mixed cues from global
markets. Asian markets rose today to follow a higher finish for the Dow industrials
in the US, after comments from Italys prime minister eased some fears of an
immediate Greek exit.
US markets, Stocks showed a lack of direction over the course of the trading day
on Thursday, as seemed reluctant to make any significant moves. The choppy
trading came after the markets saw considerable volatility over the course of the
two previous sessions.Traders also digested some uninspiring US economic data,
including a report from the Commerce Department showing a drop by a key
indicator of business spending. European markets began the session in negative
territory, following several weaker than expected economic reports from Europe.
The market managed to turn around as the session progressed, helped in part by
some positive economic results from the US.
Indian shares rebounded sharply from two days of losses on Thursday, as a steep
hike in petrol prices fueled speculation that the government may hike diesel and
LPG prices on Friday to cut the fuel subsidy bill and counter the perception of
government inaction that has lowered the credibility of the UPA government among
overseas investors.
Markets Today
The trend deciding level for the day is 16,136 / 4,894 levels. If NIFTY trades above
this level during the first half-an-hour of trade then we may witness a further rally
up to 16,338 16,454 / 4,959 4,996 levels. However, if NIFTY trades below
16,136 / 4,894 levels for the first half-an-hour of trade then it may correct up to16,021 15,819 / 4,857 4,793 levels.
SENSEX 15,819 16,021 16,136 16,338 16,454
NIFTY 4,793 4,857 4,894 4,959 4,996
News Analysis Bharti Airtel acquires a 49% stake in Qualcomm's BWA ops 4QFY2012 Result Reviews Madras Cements, TVS Motors, Hitachi 4QFY2012 Result Previews ITC, Crompton Greaves, MOILRefer detailed news analysis on the following page
Net Inflows (May 23, 2012)
FII 1,533 1,853 (320) (927) 42,534
MFs 276 293 (17) 21 (6,080)
FII Derivatives (May 24, 2012)
Index Futures 2,161 2,822 (661) 12,651
Stock Futures 2,623 1,984 639 22,647
Gainers / Losers
Tech Mahindra 666 8.8 Crompton Greav 109 (2.7)
Pantaloon Retl 152 8.6 Wockhardt 787 (2.6)
Aurobindo Phar 115 7.1 National Alum 58 (2.5)
ONGC 257 5.7 Opto Circuits 168 (2.4)
Bharti Airtel 298 5.6 Allahabad Bank 137 (2.4)
BSE Sensex 1.7 274.2 16,222
Nifty 1.8 85.8 4,921
MID CAP 0.8 44.6 5,875
SMALL CAP 0.8 46.6 6,285
BSE HC 0.6 36.3 6,649
BSE PSU 1.2 81.9 6,694
BANKEX 2.3 247.6 10,866
AUTO 1.1 103.1 9,243
METAL 1.4 134.2 9,996
OIL & GAS 2.0 147.5 7,583
BSE IT 0.8 45.9 5,526
Dow Jones 0.3 33.6 12,530NASDAQ (0.4) (10.7) 2,839
FTSE 1.6 83.6 5,350
Nikkei 0.1 6.8 8,563
Hang Seng (0.6) (119.8) 18,666
Straits Times (0.0) (0.9) 2,780
Shanghai Com (0.5) (12.5) 2,351
INFY 1.8 0.8 $43.2
WIT (0.4) (0.0) $8.6IBN 2.6 0.8 $29.3
HDB 0.7 0.2 $28.8
Advances 1,551 890
Declines 1,162 512
Unchanged 123 80
BSE 1,946
NSE 9,052
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Market OutlookMay 25, 2012
Bharti Airtel (Bharti) has acquired a 49% stake in Qualcomm's broadband wireless
access (BWA) business in India for US$165mn (~`900cr). Under the agreement,
Bharti has made an initial investment of about US$165mn to acquire 49% interest
in Qualcomm Asia Pacific's India entities that hold BWA licenses in Delhi, Mumbai,
Haryana and Kerala. Qualcomm had won spectrum for high-speed data services
in the four circles through auction in June 2010 and paid `4,912cr (~US$1bn) for
the same. Qualcomm had sold a 26% stake to Indian companies Global
Holding Corp. and Tulip Telecom for about US$58mn to comply with the sector's
foreign holding rules. The present deal has been made partly by way of acquisition
of 26% equity interest held by Global Holding Corporation and Tulip Telecom and
the balance by way of subscription of fresh equity in those entities. Bharti already
has BWA licenses in four circles Punjab, Maharashtra, Kolkata and Karnataka
and services have already been launched in the latter two. This deal will give
Bharti access to four telecoms zones, including the lucrative Delhi and Mumbai
cities, where it does not have its own 4G airwaves.
Result Reviews
Madras Cements posted 32.9% yoy growth in its top line to `912cr, in-line withour estimate. Top-line growth was aided by a 16.8% increase in volumes and
13.7% growth in realization. On a sequential basis, while volumes were higher by
23.1%, realization remained flat. OPM stood at 21.9%, down 288bp yoy, on
account of a steep 28.3% and 52.9% increase in freight costs and other expenses.
Freight costs were higher due to higher diesel costs and elevated railway freight
rates. Net profit rose by 56% yoy to `99.2cr, aided by higher other income. For the
quarter, other income stood at `31cr (vs. `18cr in 4QFY2011).
FY2013E 3,434 25.5 336 14.1 15.2 9.6 1.4 6.1 1.6
FY2014E 3,777 26.1 430 18.1 16.9 7.5 1.2 5.0 1.3
TVS Motor (TVSL) reported net profit of `57cr for 4QFY2012, in-line with our
estimates. The companys top line for the quarter remained flat on a yoy basis at
`1,627cr, as a 1.7% yoy dip in average realization completely offset the muted
growth registered in total volumes. Volume performance was muted with growth of
1.7% yoy on the back of an 11.1% and 36.0% yoy decline in motorcycle and
three-wheeler volumes, respectively. EBITDA margin came in at 6.1%, expanding
by 49bp yoy aided by 58bp yoy savings in raw-material expenses (raw-material to
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Market OutlookMay 25, 2012
sales ratio at 71.9% in 4QFY2012 vs. 72.4% in 4QFY2011 and 71.4% in
3QFY2012). Net profit during the quarter registered strong 37.3% yoy growth to
`57cr, largely due to lower tax expenses (`5cr during the quarter as against `20cr
in 4QFY2011 and `19cr in 3QFY2012). At the CMP, TVSL is trading at 5.9x
FY2014E earnings.
FY2013E 7,982 6.3 238 5.0 18.9 6.6 1.2 2.8 0.2
FY2014E 8,816 6.3 263 5.5 18.2 5.9 1.0 2.4 0.2
For 4QFY2012, Hitachi reported revenue of `236cr, 4.3% below our estimate of
`246cr; while on a yoy basis, revenue grew marginally by 3.7%. The company's
EBITDA margin stood at 6.6%, in-line with our estimate; however, it expanded
slightly by 23bp yoy due to easing raw-material prices. Net profit declined by
13.4% yoy to `7cr in 4QFY2012 from `9cr in 4QFY2011. Due to attractive
valuations at current levels with PE of 7.6x for FY2014E,
`
FY2013E 857 6.9 23 10.2 12.9 11.9 1.5 5.9 0.4FY2014E 968 8.4 37 16.0 17.8 7.6 1.2 4.2 0.4
Result Previews
ITC is expected to announce its 4QFY2012 results. For the quarter, we expect ITC
to report ~14.5% yoy growth in its top line to `6,685cr, driven by price hikes taken
by the company. The companys net profit is expected to increase by ~20.1% yoy
to `1,539cr, driven by robust sales growth and margin expansion led by price
hikes. At the CMP, the stock is trading at 22.2x FY2014E EPS.
For 4QFY2012, we project Crompton Greaves to report modest top-line growth of
9.0% yoy to `3,170cr, which can mainly be attributed to the power system
segment, which has remained a drag since the past few quarters. In addition, we
do not expect substantial growth from the overseas business, which is likely to keep
growth under check. Weak capex cycle along with strained consumer sentiment is
also likely to impact the companys growth. On the EBITDA front, the companys
margin is expected to decline sharply by ~483bp yoy to 8.0%. However, we expect
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Market OutlookMay 25, 2012
an uptick of 200bp sequentially, factoring in the cooling of commodity prices. Led
by low revenue and margin contraction, the companys PAT is expected to drop by
40.2% yoy to `150.3cr.
MOIL is slated to report its 4QFY2012. We expect its 4QFY2012 net sales to
decrease by 4.5% yoy to `251cr mainly on account a decline in manganese ore
prices. EBITDA margin is expected to contract by 2,090bp yoy to 42.5% in
4QFY2012. Net profit is expected to decrease by 26.9% yoy to `97cr.
Quarterly Bloomberg Brokers Consensus Estimate
Net sales 60,374 48,312 25 61,456 (2)
EBITDA 4,409 2,174 103 4,126 7
EBITDA margin (%) 7.3 4.5 6.7
Net profit 3,700 935 296 3,140 18
Net sales 3,247 2,999 8 3,119 4
EBITDA 264 382 (31) 198 33
EBITDA margin (%) 8.1 12.7 6.3Net profit 164 251 (35) 77 113
Net sales 861 709 21 862 (0)
EBITDA 435 460 (5) 379 15
EBITDA margin (%) 50.5 64.9 44.0
Net profit 224 301 (25) 212 6
Net sales 6,162 3,696 67 6,129 1
EBITDA 807 586 38 955 (15)
EBITDA margin (%) 13.1 15.9 15.6
Net profit 451 411 10 408 11
Net sales 5,840 7,276 (20) 4,986 17
EBITDA 531 1,053 (50) 360 48
EBITDA margin (%) 9.1 14.5 7.2
Net profit 45 432 (90) (302) (115)
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Market OutlookMay 25, 2012
Net sales 5,113 7,278 (30) 4,737 8
EBITDA 1,618 4,133 (61) 1,383 17
EBITDA margin (%) 31.6 56.8 29.2
Net profit 166 168 (1) 186 (11)
Net sales 1,101 796 38 921 20
EBITDA 251 199 26 239 5
EBITDA margin (%) 22.8 25.0 26.0
Net profit 114 100 14 103 11
Net sales 126,610 86,880 46 98,272 29
EBITDA 11,928 5,783 106 11,158 7EBITDA margin (%) 9.4 6.7 11.4
Net profit 8,456 3,905 117 2,488 240
Net sales 2,756 3,770 (27) 2,822 (2)
EBITDA 2,016 2,739 (26) 2,261 (11)
EBITDA margin (%) 73.1 72.7 80.1
Net profit 1,784 2,099 (15) 1,859 (4)
Economic and Political News Government hikes interest rate on SDS to 8.8% for 2012-13 Government to meet on Friday to discuss raising diesel prices Delays in land acquisition stall road projects worth `15,000cr RBI to take steps to arrest rupee fall: Finance MinistryCorporate News
Sun Pharma gets USFDA nod for nasal spray Mahindra & Mahindra taps Korean arm to crack China IOC may cut petrol prices if crude falls: chairman M&M eyes 100 MW from solar power projects Sun Pharma gets USFDA nod for nasal spray Mahindra & Mahindra taps Korean arm to crack ChinaSource: Economic Times, Business Standard, Business Line, Financial Express, Mint
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Date Company
May 25, 2012 ITC, NHPC, BPCL, Reliance Infra., Sun TV Network, Crompton Greaves, Suzlon Energy, MOIL, Jyoti Structures
May 26, 2012 Rcom, Jagran Prakashan, Sarda Energy, TVS Srichakra
May 27, 2012 -
May 28, 2012 NMDC, IOC, Motherson Sumi, Bharat Forge, Britannia, Bajaj Electrical, Sadbhav Engg., Amara Raja Batteries, IndocoRemedies, Subros
May 29, 2012ONGC, Tata Motors, Sun Pharma, Power Grid Corpn, SAIL, United Spirits, HPCL, GMR Infra., Aurobindo Pharma,Ipca labs, Nagarjuna Const., Prakash Industries, PVR
May 30, 2012GAIL, M&M, DLF, Jaiprakash Asso., Colgate, Tata Chemicals, HDIL, Page Industries, BGR Energy , PTC India, AnantRaj, GIPCL, Simplex Infra, SpiceJet, Greenply
May 31, 2012 -
June 01, 2012 Mphasis
Source: Bloomberg, Angel Research
Result Calendar
Global economic events release calendar
Date Country Event Description Unit Period Bloomberg Data
Last Reported Estimated
May 29, 2012 US Consumer ConfidenceS.A./
1985=100Apr-12 69.20 69.75
May 30, 2012 Euro ZoneEuro-Zone ConsumerConfidence
Value May-12 (19.30) (19.30)
May 31, 2012 Germany Unemployment change (000's) Thousands Apr-12 19.00 (10.00)
US GDP Qoq (Annualised) % Change Mar-12 2.20 1.90
India Qtrly GDP YoY% % Change - 6.10 6.00
June 01, 2012 Germany PMI Manufacturing Value May-12 45.00 --
US Change in Nonfarm payrolls Thousands Apr-12 115.00 150.00
US Unnemployment rate % Apr-12 8.10 8.10
China PMI Manufacturing Value Apr-12 53.30 52.00
India Imports YoY% % Change Mar-12 24.28 --
India Exports YoY% % Change Mar-12 (5.71) --
UK PMI Manufacturing Value Apr-12 50.50 50.00
June 05, 2012 Germany PMI Services Value May-12 52.20 --
June 06, 2012 Euro Zone Euro-Zone GDP s.a. (QoQ) % Change Mar-12 -- --
Euro Zone ECB announces interest rates % May-12 1.00 --
June 07, 2012 UK BOE Announces rates % Ratio May-12 0.50 0.50
June 09, 2012 China Industrial Production (YoY) % Change Apr-12 9.30 --
China Consumer Price Index (YoY) % Change Apr-12 3.40 --
June 10, 2012 China Exports YoY% % Change Apr-12 4.90 --
June 12, 2012 India Industrial Production YoY % Change Mar-12 (3.50) --
UK Industrial Production (YoY) % Change Mar-12 (2.60) --
June 13, 2012 US Producer Price Index (mom) % Change Apr-12 (0.20) --
June 14, 2012 US Consumer price index (mom) % Change Apr-12 -- --
Source: Bloomberg, Angel Research
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May 25, 2012
Market Outlook
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Market StrategyMay 25, 2012
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Macro watch
Exhibit1:QuarterlyGDPtrends
5.8 5.9
7.5
9.8
7.4
9.4
8.5
7.6
8.3
7.8 7.7
6.9
6.1
5.0
6.0
7.0
8.0
9.0
10.0
3QFY09
4QFY09
1QFY10
2QFY10
3QFY10
4QFY10
1QFY11
2QFY11
3QFY11
4QFY11
1QFY12
2QFY12
3QFY12
(%)
Source:
CSO,
Angel
Research
Exhibit2:IIPtrends
5.36.2
9.5
3.7 3.42.5
(5.0)
6.0
2.7
1.1
4.1
(3.5)(6.0)
(4.0)
(2.0)
-
2.0
4.0
6.0
8.0
10.0
12.0
Apr-
11
May-1
1
Jun-1
1
Ju
l-11
Aug-1
1
Sep-1
1
Oc
t-11
Nov-1
1
Dec-1
1
Jan-1
2
Fe
b-1
2
Mar-
12
(%)
Source:
MOSPI,
Angel
Research
Exhibit3:MonthlyWPIinflationtrends
9.6 9.5 9.4 9.810.0 9.9 9.5
7.76.9
7.46.9 7.2
0.0
2.0
4.0
6.0
8.0
10.0
12.0
May-1
1
Jun-1
1
Ju
l-11
Aug-1
1
Sep-1
1
Oc
t-11
Nov-1
1
Dec-1
1
Jan-1
2
Fe
b-1
2
Mar-
12
Apr-
12
(%)
Source:MOSPI,AngelResearch
Exhibit4:ManufacturingandservicesPMI
48.0
50.0
52.0
54.0
56.0
58.0
60.0
Apr-
11
May-1
1
Jun-1
1
Ju
l-11
Aug-1
1
Sep-1
1
Oc
t-11
Nov-1
1
Dec-1
1
Jan-1
2
Fe
b-1
2
Mar-
12
Apr-
12
Mfg. PMI Services PMI
Source:Market,AngelResearch;Note:Levelabove50indicatesexpansion
Exhibit5:Exportsandimportsgrowthtrends
(15)
0
15
30
45
60
75
90
Apr-
11
May-1
1
Jun-1
1
Ju
l-11
Aug-1
1
Sep-1
1
Oc
t-11
Nov-1
1
Dec-1
1
Jan-1
2
Fe
b-1
2
Mar-
12
Exports yoy growth Imports yoy growth(%)
Source:Bloomberg,AngelResearch
Exhibit6:Keypolicyrates8.00
7.00
4.75
4.00
5.00
6.00
7.00
8.00
9.00
May-1
1
Jun-1
1
Ju
l-11
Aug-1
1
Sep-1
1
Oc
t-11
Nov-1
1
Dec-1
1
Jan-1
2
Fe
b-1
2
Mar-
12
Apr-
12
May-1
2
Repo rate Reverse Repo rate CRR (%)
Source:RBI,AngelResearch
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Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS () PER(x) P/BV(x) RoE(%) EV/Sales(x)
( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E
Cement
ACC Neutral 1,153 - 21,645 11,018 12,663 19.9 21.2 70.7 81.2 16.3 14.2 2.9 2.6 18.0 19.0 1.7 1.4
Ambuja Cements Neutral 142 - 21,805 10,035 11,504 23.5 23.8 10.1 10.6 14.0 13.4 2.8 2.5 18.5 19.4 1.7 1.4
India Cements Neutral 74 - 2,264 4,423 4,906 18.2 18.8 9.9 12.7 7.5 5.8 0.6 0.6 8.6 10.5 0.8 0.7
J K Lakshmi Cements Buy 63 79 768 1,938 2,246 19.1 20.1 14.6 16.1 4.3 3.9 0.6 0.5 13.4 13.6 0.5 0.9
Madras Cements Neutral 136 - 3,236 3,434 3,777 25.5 26.1 14.1 18.1 9.6 7.5 1.4 1.2 15.2 16.9 1.6 1.3
Shree Cements Neutral 2,573 - 8,963 5,465 6,249 24.3 23.7 151.5 222.1 17.0 11.6 4.1 3.5 21.6 25.8 1.4 1.0
UltraTech Cement Neutral 1,375 - 37,686 20,116 22,655 21.3 22.5 82.1 97.5 16.8 14.1 2.6 2.3 16.8 17.4 1.8 1.7Construction
Ashoka Buildcon Buy 202 302 1,063 2,014 2,294 22.4 22.4 28.4 30.8 7.1 6.6 0.9 0.8 14.1 13.3 2.3 2.6
Consolidated Co Neutral 14 - 265 2,526 2,792 5.7 6.6 1.8 2.8 7.8 5.1 0.4 0.4 5.5 8.1 0.3 0.3
Hind. Const. Neutral 18 - 1,113 4,239 4,522 11.1 11.8 (1.8) (0.8) (10.2) (23.5) 1.1 1.2 (9.5) (4.7) 1.3 1.2
IRB Infra Buy 113 166 3,747 3,821 4,582 42.3 40.2 15.0 16.9 7.5 6.7 1.1 1.0 16.1 15.8 2.6 2.4
ITNL Buy 173 265 3,351 6,619 7,925 23.8 23.3 22.0 26.7 7.8 6.5 1.1 1.0 14.9 15.9 2.2 2.1
IVRCL Infra Buy 42 79 1,128 5,758 6,860 9.2 9.2 4.7 6.0 9.0 7.0 0.5 0.5 6.0 7.3 0.6 0.6
Jaiprakash Asso. Buy 60 104 12,705 16,017 18,359 24.4 23.5 4.2 5.0 14.2 11.9 1.2 1.1 8.8 9.7 2.1 1.9
Larsen & Toubro Buy 1,168 1,553 71,553 59,559 69,089 12.1 11.5 70.8 76.5 16.5 15.3 2.5 2.2 16.1 15.3 1.3 1.2
Madhucon Proj Buy 43 70 315 2,206 2,502 10.7 10.7 4.6 4.7 9.2 9.1 0.5 0.5 5.2 5.0 0.7 0.7
Nagarjuna Const. Buy 31 76 798 5,790 7,022 9.2 9.5 3.5 5.4 8.9 5.8 0.3 0.3 3.7 5.6 0.8 0.7
Patel Engg. Neutral 83 - 581 3,609 3,836 13.1 13.1 14.0 14.6 5.9 5.7 0.4 0.3 6.3 6.1 1.0 1.1
Punj Lloyd Neutral 45 - 1,508 10,592 12,193 8.4 8.4 2.9 4.6 15.6 10.0 0.5 0.5 3.9 3.1 0.6 0.6
Sadbhav Engg. Buy 122 199 1,828 2,989 3,315 10.6 10.6 10.2 11.3 12.0 10.8 1.9 1.6 17.6 16.3 0.8 0.8
Simplex Infra Buy 211 316 1,043 6,732 7,902 9.3 9.6 27.2 35.1 7.7 6.0 0.8 0.7 11.0 12.6 0.5 0.4
FinancialsAllahabad Bank Buy 137 166 6,833 7,392 8,542 3.1 3.1 38.3 42.1 3.6 3.3 0.6 0.5 18.4 17.6 - -
Andhra Bank Neutral 105 - 5,864 5,151 5,843 3.2 3.1 22.4 25.7 4.7 4.1 0.7 0.6 15.8 16.0 - -
Axis Bank Buy 998 1,476 41,284 16,157 19,557 3.2 3.2 116.4 139.1 8.6 7.2 1.6 1.4 20.0 20.3 - -
Bank of Baroda Buy 683 925 26,727 15,993 18,918 2.6 2.6 127.3 149.9 5.4 4.6 0.9 0.8 17.8 18.2 - -
Bank of India Buy 316 411 18,106 13,558 15,551 2.5 2.4 61.6 70.8 5.1 4.5 0.9 0.7 16.8 16.9 - -
Bank of Maharashtra Accumulate 48 53 2,815 3,580 4,050 3.2 3.2 11.5 13.1 4.1 3.6 0.7 0.6 17.4 17.2 - -
Canara Bank Buy 390 522 17,255 12,061 13,906 2.3 2.3 83.1 92.7 4.7 4.2 0.8 0.7 16.7 16.4 - -
Central Bank Neutral 75 - 5,491 6,838 7,912 2.3 2.4 13.8 20.3 5.4 3.7 0.8 0.7 10.9 14.4 - -
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Market Outlook
Stock Watch
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Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS () PER(x) P/BV(x) RoE(%) EV/Sales(x)
( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E
Financials
Corporation Bank Buy 404 486 5,984 5,203 5,880 2.2 2.1 107.5 112.7 3.8 3.6 0.6 0.6 17.9 16.5 - -
Dena Bank Buy 85 111 2,979 3,149 3,522 2.8 2.8 23.3 26.1 3.7 3.3 0.6 0.5 17.7 17.0 - -
Federal Bank Neutral 407 - 6,959 2,743 3,131 3.4 3.3 49.7 57.4 8.2 7.1 1.1 1.0 14.1 14.6 - -
HDFC Neutral 663 - 97,910 7,393 8,844 3.5 3.4 31.7 37.9 20.9 17.5 4.2 3.7 34.7 31.9 - -
HDFC Bank Buy 499 567 117,186 21,831 27,477 4.3 4.3 28.3 35.5 17.7 14.1 3.4 2.9 20.8 22.1 - -
ICICI Bank Buy 820 1,174 94,233 22,209 26,512 2.8 2.8 67.9 81.1 12.1 10.1 1.5 1.3 14.7 16.0 - -
IDBI Bank Buy 87 117 11,090 8,004 9,589 1.9 2.0 19.9 23.9 4.4 3.6 0.6 0.5 13.8 14.9 - -Indian Bank Accumulate 175 197 7,532 6,312 7,119 3.4 3.3 41.1 43.7 4.3 4.0 0.7 0.7 18.2 16.9 - -
IOB Buy 80 96 6,396 7,354 8,283 2.5 2.4 16.3 21.7 4.9 3.7 0.6 0.5 11.5 13.9 - -
J & K Bank Accumulate 918 952 4,449 2,535 2,861 3.5 3.4 176.3 184.4 5.2 5.0 0.9 0.8 19.3 17.6 - -
LIC Housing Finance Buy 239 286 12,079 2,108 2,607 2.6 2.6 24.5 30.6 9.8 7.8 1.8 1.6 20.1 21.4 - -
Oriental Bank Buy 222 274 6,480 6,431 7,315 2.7 2.6 54.4 63.8 4.1 3.5 0.6 0.5 13.6 14.3 - -
Punjab Natl.Bank Buy 724 1,015 24,546 19,893 23,653 3.1 3.2 153.4 175.2 4.7 4.1 0.9 0.7 18.3 18.1 - -
South Ind.Bank Neutral 22 - 2,486 1,399 1,596 2.6 2.5 3.5 3.8 6.2 5.8 1.1 1.0 18.7 17.5 - -
St Bk of India Buy 1,971 2,486 132,250 68,925 80,565 3.7 3.7 236.6 282.7 8.3 7.0 1.4 1.2 18.6 19.3 - -
Syndicate Bank Buy 88 131 5,294 7,133 8,255 3.0 3.0 25.9 30.0 3.4 2.9 0.5 0.5 16.9 17.1 - -
UCO Bank Neutral 66 - 4,407 5,623 6,380 2.4 2.4 16.9 17.9 3.9 3.7 0.7 0.7 16.5 15.4 - -
Union Bank Buy 203 276 11,171 10,215 11,854 2.9 2.8 42.7 50.3 4.8 4.0 0.8 0.7 17.0 17.5 - -
United Bank Buy 56 78 2,009 3,551 4,128 2.7 2.8 18.8 22.6 3.0 2.5 0.5 0.4 15.5 16.5 - -
Vijaya Bank Neutral 53 - 2,641 2,668 3,001 2.2 2.2 10.6 12.2 5.0 4.4 0.7 0.6 13.3 13.8 - -
Yes Bank Buy 328 450 11,595 3,209 4,144 2.7 2.8 33.9 41.5 9.7 7.9 2.0 1.7 23.1 23.3 - -
FMCG
Asian Paints Neutral 3,746 - 35,934 11,423 13,309 16.3 16.3 125.3 148.4 29.9 25.2 10.2 8.0 38.0 35.4 3.0 2.5Britannia Buy 527 650 6,291 5,906 6,856 6.9 7.0 22.3 28.3 23.6 18.6 9.6 7.2 45.2 44.1 1.1 0.9
Colgate Neutral 1,208 - 16,430 3,007 3,417 21.1 22.1 37.7 42.6 32.0 28.4 38.2 30.8 129.4 120.1 5.3 4.7
Dabur India Neutral 105 - 18,214 5,878 6,799 16.8 17.0 4.2 4.9 25.2 21.3 9.1 7.5 39.3 42.0 3.1 2.7
GlaxoSmith Con* Neutral 2,632 - 11,069 3,124 3,663 17.1 11.6 103.0 123.3 25.6 21.4 7.9 6.3 34.0 32.9 3.2 2.7
Godrej Consumer Neutral 555 - 18,887 5,973 7,000 18.4 18.6 22.8 27.2 24.3 20.4 6.7 5.4 31.3 38.4 3.3 2.8
HUL Neutral 425 - 91,799 25,350 29,309 14.3 14.4 14.1 16.4 30.1 25.9 22.5 17.6 82.7 76.2 3.5 3.0
ITC Accumulate 234 252 182,560 28,955 33,595 35.9 35.7 9.2 10.5 25.5 22.2 8.1 6.7 34.8 33.1 6.0 5.1
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May 25, 2012
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Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS () PER(x) P/BV(x) RoE(%) EV/Sales(x)
( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E
FMCG
Marico Neutral 173 - 10,631 4,667 5,427 12.8 12.9 6.6 8.1 26.0 21.3 7.0 5.5 30.0 28.8 2.2 1.9
Nestle* Neutral 4,547 - 43,844 8,731 10,539 21.0 21.4 119.3 147.9 38.1 30.8 23.4 15.9 73.0 61.6 5.1 4.2
Tata Global Buy 110 136 6,778 7,011 7,712 9.7 10.0 6.0 7.1 18.4 15.4 1.7 1.6 8.9 10.2 0.8 0.8
IT
HCL Tech Buy 487 560 33,710 22,792 25,743 17.4 17.4 37.8 43.0 12.9 11.3 2.8 2.4 22.3 21.3 1.4 1.2
Hexaware Neutral 127 - 3,754 1,821 2,105 19.0 18.6 9.8 10.7 12.9 11.9 3.0 2.6 23.7 22.5 1.7 1.4
Infosys Buy 2,377 2,792 136,474 37,615 42,491 31.1 30.6 158.5 174.5 15.0 13.6 3.4 2.8 22.5 20.8 2.9 2.4Infotech Enterprises Accumulate 161 177 1,790 1,758 1,972 17.0 16.6 16.8 18.6 9.6 8.6 1.3 1.1 13.6 13.2 0.6 0.5
KPIT Cummins Neutral 120 - 2,141 2,028 2,239 15.0 14.8 9.0 11.4 13.4 10.5 2.4 2.0 19.3 18.7 1.0 0.9
Mahindra Satyam Buy 77 86 9,114 7,097 7,812 16.2 16.0 7.5 8.0 10.3 9.7 1.4 1.2 13.2 12.3 0.8 0.6
Mindtree Accumulate 605 643 2,454 2,172 2,450 16.1 15.5 53.9 58.5 11.2 10.3 2.1 1.8 18.9 17.0 0.9 0.8
Mphasis Buy 375 433 7,873 5,904 6,320 18.3 17.9 38.7 41.2 9.7 9.1 1.4 1.3 14.9 13.7 0.9 0.7
NIIT Buy 39 52 645 1,162 1,304 14.8 15.1 7.1 8.8 5.5 4.4 0.9 0.8 16.7 18.4 0.4 0.3
Persistent Accumulate 344 361 1,376 1,109 1,224 23.3 22.4 37.2 40.1 9.3 8.6 1.4 1.2 15.4 14.5 0.9 0.8
TCS Neutral 1,221 - 239,045 57,189 66,329 29.3 28.7 63.2 70.9 19.3 17.2 5.9 4.8 30.5 27.7 4.0 3.3
Tech Mahindra Buy 666 725 8,486 5,880 6,314 15.6 15.2 75.9 82.2 8.8 8.1 1.8 1.5 20.1 18.1 1.3 1.1
Wipro Accumulate 392 430 96,398 41,918 46,879 19.4 19.9 25.1 28.7 15.6 13.7 2.9 2.5 18.6 18.3 1.9 1.6
Media
D B Corp Buy 198 269 3,620 1,652 1,863 25.7 26.3 13.5 16.1 14.7 12.3 3.3 2.8 24.1 24.4 2.2 1.8
HT Media Buy 113 170 2,666 2,255 2,555 17.8 18.3 10.0 12.0 11.4 9.4 1.6 1.4 14.7 15.4 0.9 0.8
Jagran Prakashan Buy 82 137 2,587 1,499 1,642 27.4 28.8 7.6 9.1 10.7 9.0 3.6 3.2 34.6 37.7 1.6 1.5
PVR Neutral 149 - 386 625 732 17.4 16.9 12.4 15.8 12.0 9.4 1.9 2.0 8.5 9.9 0.8 0.7
Sun TV Network Neutral 250 - 9,864 2,135 2,458 75.2 74.4 20.9 24.0 12.0 10.4 2.8 2.4 26.0 25.1 3.6 2.8Metals & Mining
Bhushan Steel Neutral 443 - 9,403 9,232 13,557 30.8 31.1 48.0 58.6 9.2 7.6 1.2 1.0 14.5 7.5 3.1 2.2
Coal India Accumulate 310 351 195,555 65,654 71,756 26.8 27.3 24.0 26.3 12.9 11.8 3.5 2.9 30.4 27.0 2.0 1.7
Electrosteel Castings Buy 19 27 647 1,984 2,074 10.6 12.0 2.7 3.3 7.0 5.7 0.3 0.1 5.2 6.2 0.4 0.4
Hind. Zinc Buy 116 139 48,993 13,043 14,223 51.8 52.8 14.8 16.6 7.8 7.0 1.5 1.3 21.2 19.9 2.0 1.4
Hindalco Neutral 111 - 21,175 84,652 88,766 9.6 10.5 17.0 18.9 6.5 5.9 0.6 0.6 9.7 9.8 0.5 0.5
JSW Steel Accumulate 596 663 13,288 39,592 44,910 18.0 17.7 74.7 88.9 8.0 6.7 0.8 0.7 10.7 11.6 0.7 0.6
MOIL Neutral 262 - 4,405 979 1,061 45.7 46.8 24.5 26.6 10.7 9.9 1.6 1.5 16.1 15.8 2.3 2.0
Monnet Ispat Buy 422 593 2,716 3,115 3,748 22.1 25.1 59.1 66.8 7.1 6.3 1.0 0.9 15.6 15.3 1.6 1.2
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7/31/2019 Market Outlook 250512
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Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS () PER(x) P/BV(x) RoE(%) EV/Sales(x)
( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E
Metals & Mining
Nalco Reduce 58 51 14,845 8,276 8,578 12.7 16.4 2.5 3.5 22.7 16.5 1.3 1.2 5.6 7.5 1.4 1.4
NMDC Accumulate 167 185 66,112 11,726 12,890 77.8 78.4 18.6 20.6 9.0 8.1 2.1 1.8 26.1 23.8 3.6 3.0
SAIL Accumulate 91 102 37,608 52,461 62,935 18.0 18.8 13.2 14.5 6.9 6.3 0.8 0.7 12.4 12.3 1.1 1.0
Sesa Goa Buy 180 206 15,674 9,067 9,316 35.7 35.5 44.5 44.3 4.1 4.1 0.9 0.7 23.5 19.5 0.3 -
Sterlite Inds Buy 95 123 32,043 45,805 49,029 21.2 23.5 16.5 19.1 5.8 5.0 0.6 0.6 11.5 12.0 0.3 0.2
Tata Steel Buy 399 499 38,708 143,088 148,011 10.9 12.1 53.9 66.0 7.4 6.0 0.9 0.8 12.2 13.4 0.6 0.6
Oil & GasCairn India Buy 317 372 60,467 15,513 16,074 74.0 69.7 51.1 48.6 6.2 6.5 1.0 0.9 18.3 14.8 2.8 2.0
GAIL Buy 325 392 41,270 50,472 55,503 15.3 15.6 35.4 37.0 9.2 8.8 1.6 1.4 18.7 17.0 0.5 0.4
ONGC Buy 257 319 219,833 148,157 150,563 37.6 39.5 31.0 33.6 8.3 7.6 1.5 1.3 18.8 18.1 1.0 0.9
Reliance Industries Buy 696 872 228,056 325,734 328,669 10.9 11.7 65.8 70.1 10.6 9.9 1.1 1.0 11.9 11.5 0.7 0.6
Pharmaceuticals
Alembic Pharma Buy 51 91 958 1,624 1,855 14.2 15.6 6.6 9.1 7.7 5.6 1.9 1.5 27.5 29.2 0.8 0.7
Aurobindo Pharma Buy 115 175 3,358 5,243 5,767 14.6 14.6 13.8 14.7 8.4 7.9 1.0 0.4 11.4 10.9 0.9 0.8
Aventis* Neutral 2,059 - 4,742 1,482 1,682 15.5 15.5 95.0 104.0 21.7 19.8 3.8 3.0 18.6 17.0 3.0 2.6
Cadila Healthcare Buy 747 953 15,285 6,196 7,443 18.5 19.5 43.3 50.8 17.2 14.7 4.4 3.6 25.4 24.8 2.4 1.9
Cipla Buy 310 379 24,891 7,687 8,804 21.4 21.4 16.5 18.9 18.8 16.4 2.9 2.6 16.7 16.8 3.2 2.7
Dr Reddy's Neutral 1,704 - 28,887 10,696 11,662 20.7 21.0 83.7 92.9 20.4 18.4 4.2 3.6 22.4 21.0 2.8 2.5
Dishman Pharma Buy 46 92 372 1,280 1,536 17.8 17.8 9.2 11.3 5.0 4.1 0.4 0.4 7.7 8.5 1.0 0.8
GSK Pharma* Neutral 1,975 - 16,731 2,651 2,993 31.7 31.2 76.0 82.4 26.0 24.0 7.5 6.5 30.8 29.0 5.3 4.6
Indoco Remedies Buy 58 665 537 685 837 15.2 15.2 55.5 66.5 1.1 0.9 0.2 0.1 16.4 16.9 1.0 0.9
Ipca labs Buy 339 443 4,270 2,907 3,541 21.5 21.5 32.4 40.6 10.5 8.4 2.6 2.1 27.8 27.7 1.6 1.3
Lupin Buy 533 646 23,822 8,426 10,082 19.7 20.0 29.7 32.4 18.0 16.5 4.7 3.7 27.0 25.2 2.8 2.2Orchid Chemicals Buy 123 178 866 2,117 2,434 17.7 17.7 16.7 22.2 7.4 5.5 0.7 0.6 9.5 11.5 1.0 0.9
Ranbaxy* Neutral 526 - 22,222 12,046 11,980 18.0 15.8 35.7 29.8 14.8 17.7 5.5 4.5 43.1 28.1 1.8 1.7
Sun Pharma Accumulate 570 634 58,699 9,272 11,080 40.3 36.3 26.7 28.8 21.4 19.8 4.3 3.7 22.1 20.8 5.6 4.6
Power
CESC Buy 269 342 3,355 5,084 5,512 24.2 23.8 45.2 48.5 5.9 5.5 0.6 0.6 11.2 10.9 1.1 1.1
GIPCL Buy 61 98 929 1,557 1,573 28.7 27.5 10.4 10.2 5.9 6.0 0.6 0.6 10.5 9.6 1.0 0.9
NTPC Buy 142 201 117,333 74,766 86,549 23.1 23.4 12.4 14.1 11.5 10.1 1.4 1.3 13.0 13.5 2.3 2.1
Real Estate
Anant Raj Buy 46 78 1,369 657 875 52.0 56.1 8.4 12.7 5.5 3.7 0.3 0.3 6.3 8.9 3.4 2.5
DLF Neutral 185 - 31,412 9,878 12,033 44.7 46.1 9.6 13.4 19.3 13.8 1.2 1.2 6.4 8.7 5.7 4.6
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7/31/2019 Market Outlook 250512
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Company Name Reco CMP Target Mkt Cap Sales ( cr ) OPM(%) EPS () PER(x) P/BV(x) RoE(%) EV/Sales(x)
( ) Price ( ) ( cr ) FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E FY13E FY14E
Real Estate
HDIL Buy 62 115 2,604 2,441 3,344 53.0 46.7 21.4 25.4 2.9 2.5 0.2 0.2 8.4 9.1 2.9 2.2
Telecom
Bharti Airtel Neutral 298 - 113,090 80,967 88,684 33.1 33.4 17.9 22.0 16.7 13.5 1.9 1.7 11.5 12.5 2.0 1.7
Idea Cellular Neutral 78 - 25,681 22,558 25,326 26.4 27.5 3.2 4.7 24.1 16.4 1.8 1.6 7.5 10.0 1.6 1.4
Rcom Neutral 65 - 13,323 21,899 23,740 32.7 32.7 4.2 6.7 15.3 9.7 0.3 0.3 2.1 3.2 2.0 1.6
zOthers
Bajaj Electrical Accumulate 217 245 2,166 3,670 4,384 8.5 8.5 18.3 22.3 11.9 9.7 2.6 2.2 23.9 24.3 0.6 0.5CRISIL Neutral 1,070 - 7,509 982 1,136 34.3 34.3 34.3 40.0 31.2 26.8 14.1 11.3 50.9 46.9 7.2 6.0
Finolex Cables Buy 37 61 562 2,334 2,687 8.8 9.3 7.6 10.2 4.8 3.6 0.6 0.5 13.7 16.1 0.2 0.1
Graphite India Buy 91 124 1,776 2,158 2,406 18.1 18.9 12.4 14.0 7.3 6.5 1.0 0.9 14.0 14.3 1.0 0.8
Greenply Buy 214 298 518 1,800 2,047 11.1 11.6 34.1 49.6 6.3 4.3 1.2 0.9 20.2 23.7 0.5 0.4
Page Industries Neutral 3,016 - 3,364 935 1,168 19.6 19.6 99.7 122.2 30.3 24.7 17.5 14.0 64.2 63.1 3.7 2.9
Sintex Buy 54 129 1,461 4,751 5,189 16.3 16.6 13.6 15.8 3.9 3.4 0.5 0.5 13.1 13.4 0.7 0.5
Siyaram Silk Mills Buy 260 439 244 1,042 1,173 12.4 12.5 66.3 78.5 3.9 3.3 0.8 0.6 21.1 20.8 0.5 0.4
SpiceJet Neutral 32 - 1,560 5,384 6,443 (1.0) 4.1 (3.4) 2.4 (9.4) 13.5 (13.0) 27.5 - - 0.5 0.4
Taj GVK Buy 58 108 366 300 319 35.8 36.2 7.9 9.1 7.4 6.4 1.0 0.9 13.9 14.4 1.5 1.3
Goodyear Accumulate 334 372 770 1,571 1,753 7.2 8.6 29.8 42.4 11.2 7.9 2.1 1.8 20.2 24.3 0.3 0.2
HEG Buy 208 242 831 1,746 1,946 16.5 17.7 22.5 32.9 9.2 6.3 0.9 0.9 10.4 14.2 1.1 1.0
Hitachi Buy 121 160 279 857 968 6.9 8.4 10.2 16.0 12.0 7.6 1.5 1.3 12.9 17.8 0.4 0.4
Honeywell Automation Neutral 2,543 - 2,248 1,542 1,739 9.4 10.0 116.1 140.8 21.9 18.1 3.1 2.7 15.5 15.9
Ineos ABS Neutral 758 - 1,332 900 1,011 10.2 11.5 35.6 45.7 21.3 16.6 3.1 2.7 15.4 17.2
ITD Cementation Reduce 217 196 250 1,535 1,811 10.6 10.7 26.2 39.6 8.3 5.5 0.6 0.6 7.6 10.6 0.6 0.6
MRF Buy 10,522 13,106 4,463 12,390 14,400 10.4 11.3 1,334.6 1,638.2 7.9 6.4 1.6 1.3 16.5 17.4 0.5 0.5Relaxo Neutral 416 - 499 961 1,129 11.8 12.3 46.6 59.9 8.9 6.9 2.3 1.7 28.7 28.0 0.8 0.6
Tata Sponge Buy 265 420 408 757 875 19.0 19.1 63.5 72.9 4.2 3.6 0.6 0.6 16.1 16.1 0.1 -
TVS Srichakra Buy 326 462 250 1,612 1,827 9.5 9.8 72.3 92.5 4.5 3.5 1.3 1.0 33.1 32.1 0.4 0.3
Vesuvius India Neutral 380 - 772 621 711 15.3 15.5 27.3 32.4 13.9 11.7 2.2 1.9 17.2 17.6 1.0 0.9
Abbott India Accumulate 1,443 1,628 3,066 1,661 1,918 9.7 12.0 60.7 90.4 23.8 16.0 4.9 4.0 22.0 27.3 1.6 1.3
Cera Sanitaryware Ltd Accumulate 252 288 319 385 444 17.2 17.4 28.9 32.0 8.7 7.9 1.8 1.5 23.4 21.1 1.0 0.9
Jyothy Laboratories Buy 197 248 1,585 1,359 1,627 10.3 12.9 13.9 20.6 14.1 9.5 4.6 3.4 35.8 41.3 1.6 1.2
Force Motors Buy 461 680 601 2,346 2,753 6.7 7.0 50.9 61.9 9.1 7.5 0.5 0.5 5.5 6.3 0.2 0.2
Source: Company, Angel Research; Note: *December year end; #September year end; &October year end; Price as on May 24, 2012
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May 25, 2012Market Outlook