Brokers’ call: DB Corp, Crompton, Pipavav Defence
Citigroup has resumed coverage on DB Corp by maintaining a ‘Buy’ and marginally raising the target price to Rs 230.
Updated:
Citigroup Puts a ‘Buy’ on DB Corp
Citigroup has resumed coverage on DB Corp by maintaining a ‘Buy’ and marginally raising the target price to Rs 230. Cyclical pressures of a slower advertising market, investments in new states and newsprint cost inflation are impacting reported profit growth rates near term.
“We would buy into the weakness, as we believe the medium-to-long term prospects for DBCL remain healthy — given the steady core business performance and an encouraging initial response to the new state launches (esp. Maharashtra)” said the Citigroup report.
Pipavav Defence to Touch Rs 99
Kim Eng has maintained its ‘Buy’ rating on Pipavav Defence with a target price of Rs 99. Last month, the company secured approval from the government to form a JV with Mazgaon Dock (MDL) to make naval ships. This much-awaited event is a precursor to the transfer of a major proportion of MDL’s backlog of Rs 1 trillion to the JV.
Thier confidence in Pipavav’s order book, execution and earnings further increased with the announcement of strategic relationship with DCNS of France last month.
Kim Eng believes investors will take notice of Pipavav’s new order book prospects, financial and strategic equity participation of global defence majors. The stock is trading at an attractive PER of 9x FY13F.
Crompton a ‘Buy’: BofA-ML
Bank of America has maintained a ‘Buy’ rating on Crompton Greaves with a target price of Rs 151. Crompton Greaves announced plans to restructure its Belgium operations, about 35% of its Belgian workforce will be impacted.
This is inline with manangement’s target to shift manufacturing from high cost (Belgium) to low cost in EU. Partial relocation of manufacturing to Hungary can add 65bp EBITDA of international operations by FY14.
Citigroup has resumed coverage on DB Corp by maintaining a ‘Buy’ and marginally raising the target price to Rs 230. Cyclical pressures of a slower advertising market, investments in new states and newsprint cost inflation are impacting reported profit growth rates near term.
“We would buy into the weakness, as we believe the medium-to-long term prospects for DBCL remain healthy — given the steady core business performance and an encouraging initial response to the new state launches (esp. Maharashtra)” said the Citigroup report.
Pipavav Defence to Touch Rs 99
Kim Eng has maintained its ‘Buy’ rating on Pipavav Defence with a target price of Rs 99. Last month, the company secured approval from the government to form a JV with Mazgaon Dock (MDL) to make naval ships. This much-awaited event is a precursor to the transfer of a major proportion of MDL’s backlog of Rs 1 trillion to the JV.
Thier confidence in Pipavav’s order book, execution and earnings further increased with the announcement of strategic relationship with DCNS of France last month.
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Kim Eng believes investors will take notice of Pipavav’s new order book prospects, financial and strategic equity participation of global defence majors. The stock is trading at an attractive PER of 9x FY13F.
Crompton a ‘Buy’: BofA-ML
Bank of America has maintained a ‘Buy’ rating on Crompton Greaves with a target price of Rs 151. Crompton Greaves announced plans to restructure its Belgium operations, about 35% of its Belgian workforce will be impacted.
This is inline with manangement’s target to shift manufacturing from high cost (Belgium) to low cost in EU. Partial relocation of manufacturing to Hungary can add 65bp EBITDA of international operations by FY14.
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