Buy Sterling Tools, target Rs 1207 : Motilal Oswal Securities

Motilal Oswal Securities has Buy call on Sterling Tools Ltd. with a target price of Rs 1207 .The current market price of Sterling Tools Ltd. is Rs 924.9 Time period given by analyst is a year when Sterling Tools Ltd. price can reach defined target.
The company has started work on the phaseI expansion for a new plant in Gujarat. Total capex for the project will be Rs 50 crore, likely to be commissioned by September 2017.Conducive macro factors like good monsoons, 7th pay commission roll out, passage of GST, increasing localisation by OEMs will propel the company on growth path, going forward. Motilal Oswal Securities expects earnings growth of 20% over FY16-18E and values the company at 20 times FY 18E EPS with a target price