Here are Religare's Top Picks in Midcap Space,
Dena Bank - Valuations are attractive at 0.8x FY12 BV and 4.7x FY12 EPS given healthy ROE of 21% over FY11-13E (despite recent capital infusion by GoI).
Educomp - We expect a revenue/EPS CAGR of 22%/15% (FY10-FY12), driven by strong revenue growth of 26% in Smartclass and 66% in K-12. Securitization model in Smartclass and dry K-12 management should help improve cash generation and ease investor concerns on high capex.
IRB Infra- Our target price of Rs 330 is based on SoTP with Rs 255 for the core business (4.5x forward EV/EBITDA) and Rs 75 for strategic investments.
Radico Khaitan - We expect Radico Khaitan to move up the value chain from its positioning in the mass market to the premium end of the liquor portfolio, which could lead to a stock re-rating over a period of time. We estimate a 30% EPS CAGR for the company over FY11-FY13 supported by a 20% revenue CAGR and margin expansion.
Sintex - Concerns in the stock with regards to investment in power and oil and gas have been addressed. We expect a an earnings CaGR of 24% over the next two years. Current valuation of 8.9x FY12E earnings looks attractive. Maintain our Buy rating on the stock.
Yes Bank - The stock is trading at an attractive valuation of 2.4x FY12 BV and 12.3x FY12 EPS given earnings growth of 27% CAGR through FY13 and healthy ROEs of 21%. The bank is likely to raise capital in FY12 to fund its growth
