Category: Economy, Markets and Macro Views

SBI Cap Securities has initiated coverage on Jai Hind Projects Ltd [JPL]. JPL operates as an engineering, procurement and construction (EPC) company. The company is involved in the construction and laying of onshore and horizontal directional drilling (HDD) pipelines, urban infrastructure development projects like construction of water systems, gas distribution projects and other environmental projects, corrosion protection services and engineering & turnkey projects.

JPL has an order backlog worth Rs.2142.4 mn as on FY07, which is 179.4% higher than FY06. Average ticket size has improved to Rs.235 mn, from Rs.125 mn in FY06. In order to support big ticket size projects, JPL has planned capital expenditure of Rs.400 million in span of two years. JPL is planning to enter into global EPC contracts for which it has tied up with Thiess of Australia, Naftogaz of Ukraine.

Valuations and Target for JPL (more…)

If you had bought Punj Lloyd on our recommendation, then we recommend investors to Book Profits Partially. The stock has run up post-split 200% since we recommended and hence profits should be taken out.

Also book partial profits in (more…)

Voltas’ strong performance for the second quarter in a row came in as a positive surprise, after soft performance for most of last fiscal. Revenue growth, at ~35% Y-o-Y (to INR 7 bn), on the back of a 30% plus growth across segments. EBIT margins improved in excess of 500bps for both electromechanical projects (EMPS) and engineering agency and services (EAS) segments, tripling the EBITDA to INR 636 mn. Earnings was up 79% Y-o-Y on improved margins of 6% at the net level, to INR 431 mn.

Voltas current order backlog of Rs27bn (up 37%YoY) improves visibility going forward. Voltas won 3 international orders worth Rs7bn in Q208. Management has indicated (more…)

ABB has declared another good set of results. Revenues stood at Rs.13.8 bn; up 29% yoy while EBITDA was up 56% at Rs.1.7 bn and PAT was up 41% at Rs.1.16 bn. EBITDA margins have increased sharply YoY in 3Q07 by 219 bps to 12.5%, the strongest leverage in the last six quarters.

India is not only a promising domestic market, where ABB is well-positioned as a market leader in power and automation technologies, but also a key regional and global resource base because of lower costs and higher productivity.

ABB is getting pricey as it seems to be running ahead of the fundamentals. ABB has had a strong run over the past three years, outperforming the BSE Sensex significantly over different horizons. Citi downgraded ABB to Hold/Low (2L) risk from Buy/Low (1L) risk an new target price (more…)

You probably think we are insane to recommend a BUY when the SENSEX is at an all time high. Well our job gets really tough, when India an oil dependent economy has to face the burden of larger fiscal deficit with rising oil prices [$93 / barrel an all time high]. However, our analysts are extremely careful when they recommend a BUY. You will also see some Book Profits recommendation within the next few hours.

Bharat Forge’s standalone Q2 net profit was 27% ahead of estimates, driven by higher sales and huge surprise in margins. (more…)

We had an in depth and up to date coverage about Nagarjuna Constructions. Now we are raising the price target to Rs 350. Primary reason for the same is revisions in earnings estimates by -9% to +14% over FY08E-10E. Increasing target multiple for core business to 19x from 16x earlier due to a structural change in the business mix, and rolling forward our target basis to Sept. 09E from Mar. 09E.

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