Mid Term Stock Picks - Apr 15, 2011

Posted by admin in Mid Term Picks on Apr 14th, 2011 | no responses

The following stocks have recommended for Mid Term Investment by Broking House Microsec Capital

Navneet Publications

Recommendation: Buy
Market Price: Rs 63
Target Price: Rs 76
Navneet is into publishing educational, children books and stationary products. With change in syllabus in Maharashtra and Gujarat, stromg brand, financials and penetration into e-learning, it will touch the price of Rs 76 based on its FY 12E EPS of 4.1.

Tata Chemicals

Recommendation: Buy
Market Price: Rs 362
Target Price: Rs 460
Tata Chemicals is likely to be benefited from a JV with Olam and expected hike in benchmark imprt price of DAP, MOP and gas allocation from KG-D6 block. We assign a EV/EBITDA multiple of 7.53x and arrive at a target price of Rs 460.

GAIL

Recommendation: Buy
Market Price: Rs 475
Target Price: Rs 540
GAIL India, the country’s largest gas transmission and marketing company, has long-term revenue visibility and value creation through the CGD(city gas distribution) business. GAIL trades at PE of 14.30 times FY12 EPS(E) of 33.15.

Bharat Forge

Recommendation: Buy
Market Price: Rs 359.5
Target Price: Rs 417
A leading global auto forging player, diversifying into non-auto segment, Bharat Gorge is likely to benefit from the turnaround in developing markets. With better-than-expected results in Q3, 2011, the company is likey to reach a target price of Rs 417.

Chambal Fertilizers

Recommendation: Buy
Market Price: Rs 86
Target Price: Rs 95
Chambal Fertilizers is a leading urea manufacturer in India. The company is likely to get higher EBITDA margin due to the expected increase in gas allocation from RIL. We assign a P/E multiple of 11.3x on its FY 12 E EPS of 8.4 and drive at a target price of Rs 95.