MUMBAI: Sharekhan has recommended buy on Punj Lloyd for a target price of Rs 532, an upside of 84.1 per cent from current level. Punj Lloyd is the second largest erection procurement and construction player in the country with a global presence.
Sharekhan believes that Punj Lloyd along with SEC and Simon Carves, is well integrated and poised to tap the global opportunity available in hydrocarbons and infrastructure sectors.
The company has witnessed a five-fold increase in its average order size from $30 million to about $130-140 million. This move-up on the value chain has made Punj Lloyd more competitive in executing larger and complex orders.
Sharekhan expects the spectacular order flow to continue for Punj Lloyd. The current order book of Rs 20,162 crore is 2.6x its FY2008 sales and imparts strong visibility. The brokerage expects Punj Lloyd’s consolidated revenues and profits to grow at a CAGR of 30.5 per cent and 44.1 per cent respectively over FY2008-10E.
At the market price the stock trades at 16.6x and 12.5x its FY2009E and FY2010E fully diluted EPS respectively.
thanks : economictimes.indiatimes.com
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