Accumulate ABG Shipyard for target of Rs 230: Prabhudas Lilladher

MUMBAI: Prabhudas Lilladher has maintained Accumulate rating on ABG Shipyard after the company announced its quarterly results. The brokerage expects the stock to touch a target price of Rs 230 per share.

ABG Shipyard���s topline for the quarter stood at Rs 3,368.6 million indicating a growth of 40% YoY. However, the topline declined by 29.3% QoQ.

Besides a change in the accounting policy, LC and bank guarantee charges were lower in the quarter. The company also converted certain working capital loans to commercial paper, thereby leading to a decrease in the average borrowing cost. ABG���s net profits increased by 12.8% YoY and QoQ on account of this saving.

���ABG currently trades at a PER of 8.9x FY10 and 6.3x FY11 (ex-subsidy). We expect the company���s profits (ex-subsidy) to grow at 16.2% CAGR over the next two years. We maintain our ���Accumulate��� rating on the stock,��� the report said.