Analysts' pick: Container Corp
Enam Securities has maintained its 'outperformer' rating on Container Corp stock.
Container Corp
CMP: Rs 892
Target Price: Rs 1,035
Enam Securities has maintained its ���outperformer��� rating on the stock. Enam believes that despite improving visibility on earnings (19% CAGR over FY07-09E) and sustainability of RoE (return on equities) at around 25%, the stock trades at a 12% discount to the Sensex valuation.
���Compared with global peers, admittedly with high barriers to entry, Container Corporation trades at 40% discount,��� the Enam note said to its clients.
According to Enam, growth in India���s export-import trade and investment in rail, road and ports infrastructure would drive growth for the company. ���Steep increase in rail haulage charges had dampened volume growth in the past three years. Current pricing environment remains stable, with IR to hike haulage charges twice a year,��� said the note.
The brokerage expects Container Corporation EXIM throughput to revert back to long average of 14% per annum. ���Lower flat discounts and increase in tariff are expected to drive 244 bps expansion in EBIT margin over the next two years,��� the note added.
CMP: Rs 892
Target Price: Rs 1,035
Enam Securities has maintained its ���outperformer��� rating on the stock. Enam believes that despite improving visibility on earnings (19% CAGR over FY07-09E) and sustainability of RoE (return on equities) at around 25%, the stock trades at a 12% discount to the Sensex valuation.
���Compared with global peers, admittedly with high barriers to entry, Container Corporation trades at 40% discount,��� the Enam note said to its clients.
According to Enam, growth in India���s export-import trade and investment in rail, road and ports infrastructure would drive growth for the company. ���Steep increase in rail haulage charges had dampened volume growth in the past three years. Current pricing environment remains stable, with IR to hike haulage charges twice a year,��� said the note.
The brokerage expects Container Corporation EXIM throughput to revert back to long average of 14% per annum. ���Lower flat discounts and increase in tariff are expected to drive 244 bps expansion in EBIT margin over the next two years,��� the note added.
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