Stocks to buy now
Saturday, May 24, 2008 | | |Redington India Target 445
According to the brokerage estimates, Redington is “setting up four automated distribution centres in India and one abroad”.
The move into high-end repair activities should sustain the growth of high margin service segment, it adds. Meanwhile, enhanced infrastructure base, feels the brokerage, would help the company “capitalise on ro-bust domestic market and increase its market share”.
VOLTAMP TRANSFORMERS Target 1650
Voltamp’s order book stands at Rs 4.48 billion,” says a report, adding that “its order book was flat at Rs 4.07 billion” for the quarter ended March 31. According to the brokerage, the company will undertake capital expenditure of Rs 350 million for a greenfield project, wherein oil type and dry type transformers will be manufactured.
PUNJAB NATIONAL BANK TARGET 700
Merrill Lynch has cut its price target for Punjab National Bank (PNB) to Rs 700 from Rs 825 to factor in earnings moderation led by pressure on margins and higher provisions from wage revisions. However, the investment bank has raised its earnings estimates by 1-4% for 2009-10. “We believe the stock could trade at 1.4-1.5 times by FY10 (2009-10) given its forecast ROE(return on equity) of 17-18%, earnings growth of 18% through FY10E (estimated), improved quality of earnings arising from lower trading profits and lower risk from interest rate changes,” Merrill said in a recent client note. “On a PE (price to earnings) basis we believe the bank can continue to trade at least at 7.5-8.0x FY10E (estimated) earnings, as banks’ net NPLs (non-performing loans) shrink,” the investment bank said