Brokers’ Picks: Sobha Developer, Bharti Airtel and IRB Infra

Kim Eng Retains ‘Buy’ on Sobha

Sobha Developer’s shares are trading 20% below sector avg PER. The target PER is 17x FY14F

Co has continued its momentum with 26% presales growth in Q1. The quarterly selling price of Rs 6,548/sq ft was 15% above 1QFY13 due to the launch of high-end homes.

Profit growth of 29% for FY14 will come from the current stock of preordered homes and 22% increase to Rs 27 billion.

Target: Rs 497 Current price: Rs 341.30

Bharti Airtel Remains a ‘Buy’: Citi

Bharti has underpe--rformed market by 7% YTD. CMP implies its India business is trading at ~30% disc to Idea

While Idea should continue to trade at a premium to Bharti given best-in-class execution and better growth, Bharti’s (still widening) valuation gap with Idea should start narrowing as its domestic biz trends starts tracking those of its GSM peers

Target: Rs 370 Current price: Rs 293.45

IRB Infra a ‘Buy’: Geojit BNP Paribas

At the current price range, the scrip has corrected 19% in the last month and the correction offers a better entry opportunity.

The fundamentals of the company remain intact.The macro environment is likely to improve in the next two quarters and bidding is expected to commence in 3QFY14

Tolling in Kolhapur project is likely to start soon

Target: Rs 152 Current price: Rs 92.30