PINC's analysis of Everest Kanto Cylinder
Rationale: Spiraling fuel prices and emission concerns have spawned a vibrant market for CNG vehicles, and vehicles using CNG as fuel have registered a CAGR of 30% and 50% in India and Asia respectively (for 2002-07).
Everest Kanto Cylinder
Broking Firm: PINC
Price at the time of recommendation: Rs 291
Target Price: Rs 385
Rationale: Spiraling fuel prices and emission concerns have spawned a vibrant market for CNG vehicles, and vehicles using CNG as fuel have registered a CAGR of 30% and 50% in India and Asia respectively (for 2002-07).
This growth is likely to witness traction due to sustained governmental support and operational economics of CNGbased operations. Everest Kanto Cylinder (EKC) is doubling its production capacity to 2.3 million cylinders per annum by FY12.
It bought CP Industries , USA in April ���08. These initiatives have the potential to propel EKC���s net sales by a CAGR of ~47%, over the next three years, with sustained margins and improved operational metrics . We initiate coverage with a Buy recommendation, with a target price of Rs 385 on an investment perspective of 18 months.
Closing price on Monday, September 15, 2008: Rs 291
Broking Firm: PINC
Price at the time of recommendation: Rs 291
Target Price: Rs 385
Rationale: Spiraling fuel prices and emission concerns have spawned a vibrant market for CNG vehicles, and vehicles using CNG as fuel have registered a CAGR of 30% and 50% in India and Asia respectively (for 2002-07).
This growth is likely to witness traction due to sustained governmental support and operational economics of CNGbased operations. Everest Kanto Cylinder (EKC) is doubling its production capacity to 2.3 million cylinders per annum by FY12.
It bought CP Industries , USA in April ���08. These initiatives have the potential to propel EKC���s net sales by a CAGR of ~47%, over the next three years, with sustained margins and improved operational metrics . We initiate coverage with a Buy recommendation, with a target price of Rs 385 on an investment perspective of 18 months.
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Closing price on Monday, September 15, 2008: Rs 291
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