Citi puts 'Sell' on BGR Energy

Citi analysts cut the target price for BGR Energy Systems to Rs 252 from Rs 272 earlier on expectations of lower earnings and compressed margins. The analysts maintained the 'Sell' rating for the stock, saying that while the BGR's earnings for the quarter ended March were in line with expectations, margins will decline in the next three years and return on equity will fall to 15% by 2015.

New factory construction will be a negative for the balance sheets. “It is pertinent to note that this might not have a P&L impact till FY16E when these facilities get commissioned,” the analysts said.