Monday, 17 November 2008

Buy IVRCL Infra: Motilal Oswal

Motilal Oswal has maintained its buy rating on IVRCL Infrastructure and Projects in its November 12, 2008 research report. "Strong revenue growth during 1HFY09 was partially aided by benefits accrued on account of price variation clauses. For FY09 management has guided for revenue growth of 35-40% YoY and EBITDA margin of 9.5-9.9% (earlier at 10%). It also indicated that incremental debt requirement during FY09 will be limited to Rs 1.5-2 billion (existing debt Rs 14.5 billion). The net working capital stands at Rs 23 billion as at September 2008 compared with Rs 19.7 billion at end-FY08. Loans and advances currently stand at Rs 4 billion, including Rs 2.6 billion to IVR Prime."

"We expect IVRCL to report net profit of Rs 2.3 billion in FY09 (up 10% YoY) and Rs 3.2 billion in FY10 (up 37% YoY). The stock is trading at 7.6x FY09E earnings and 5.5x FY10E earnings. Maintain Buy," says Motilal Oswal's research report.

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Source: Moneycontrol

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