Sharekhan maintains ‘Buy’ on Sintex with target of Rs 353

MUMBAI: Sharekhan has maintained its ‘Buy’ recommendation on Sintex Industries after the company announced its first quarter results.

The consolidated bottom line came in at Rs 78.8 crore (up 30.1% year on year [yoy}) and consolidated revenues from the operations stood at Rs910.6 crore registering a robust year-on-year (y-o-y) growth of 37.5%.

“We maintain our bullish stance on the company on account of the strong revenue visibility and the margin expansion play in the wake of the strong growth in the building material (monolithic as well as prefab businesses) and custom moulding divisions as well as the stable performance of the textile business.

We expect the company’s earnings to grow at a compounded annual growth rate (CAGR) of 22% over FY2010-12E.

We maintain our Buy recommendation on the stock with a price target of Rs 353. At the current market price the stock is trading at 11.7x and 9.1x its FY2011E and FY2012E earnings respectively,” the report said.