Monday 3 November 2008

Buy Kotak Mahindra Bk, target of Rs 555: Motilal Oswal

Motilal Oswal has maintained its buy rating on Kotak Mahindra Bank with a target of Rs 555 in its October 31, 2008 research report. "Kotak Mahindra Bank’s consolidated PAT declined 40% in 2QFY09 to Rs 1.5 billion (pre-insurance business). We have cut our earnings estimates for Kotak Mahindra Bank (standalone) by 22% for FY09 and 28% for FY10 considering the lower business growth, muted fees, lower recoveries and cost pressures."

"We are cutting earnings estimates for Kotak group by 13% for FY09 and 17% for FY10. Adjusted for Kotak Life’s value at Rs 101/share on FY09 basis and Rs 121/share on FY10 basis, the stock trades at 10x FY09E EPS and 7x FY10E EPS. We are lowering valuation multiples for each of the businesses in our SOTP valuation. Our revised target price on SOTP basis stands reduced to Rs 555/share - an upside of 65%. Maintain Buy," says Motilal Oswal's research report.

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Source: Moneycontrol

Posted by Harsh at 07:08

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