Rallis India Limited - Expansion to steer growth:: GEPL PDF link

Please Share:: India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��

  Summary

click to view report

 a)   New Dahej facility to spruce up international sales; reduce domestic market dependence.

 b)   Metahelix acquisition to help company grab a bigger pie in the lucrative seeds market.

 c)   Consistent product launches and continued emphasis on R&D to keep "innovation turnover               index high".

 d)   Numerous initiatives and customer engagement programs to help company retain its top of             the mind status.

At CMP of Rs123, Rallis is trading at 17x its FY12E EPS and 12x its FY13E EPS, which is close to its average historical one year forward P/E. As compared to its listed domestic peers, Rallis commands a rich premium of close to 30%. We expect Rallis to continue to command premium due to its consistent product launches, ramp up in capacity at Dahej facility and improvement in performance of Metahelix.

We initiate coverage on the stock with a BUY rating and a target price of Rs153 per share based on a P/E of 15x FY13E EPS of Rs10.20, implying a potential upside of 25%.