vishnuvega
18-11-2007, 11:33 AM
PINC has come out with research report on RSWM. The firm has maintained buy rating on the stock with a price target of Rs 135, in a research report dated on November 13, 2007.
"RSWM Ltd. (RSWM) reported a YoY revenue growth of 25% to Rs3 billion in Q2FY08. This was mainly led by increasing yarn volumes and contribution from denim fabrics. Margins expand by 30bps Net profit declines by 60% Capital charges grew by 67% to Rs270 million on account of capacity expansions. Higher capital charges coupled with higher effective tax rate resulted in the net profits declining by 60% to Rs29 million. RSWM’s expansion of yarn capacities, savings in power costs, contribution from denim fabrics and expected turnaround in fabric business should aid in revenue growth and margin expansion. Also, the embedded value of its holding in Bhilwara Energy should provide further upside. Hence, we maintain our ‘BUY’ recommendation with a price target of Rs135 on an investment perspective of one year." According to PINC research report.
"RSWM Ltd. (RSWM) reported a YoY revenue growth of 25% to Rs3 billion in Q2FY08. This was mainly led by increasing yarn volumes and contribution from denim fabrics. Margins expand by 30bps Net profit declines by 60% Capital charges grew by 67% to Rs270 million on account of capacity expansions. Higher capital charges coupled with higher effective tax rate resulted in the net profits declining by 60% to Rs29 million. RSWM’s expansion of yarn capacities, savings in power costs, contribution from denim fabrics and expected turnaround in fabric business should aid in revenue growth and margin expansion. Also, the embedded value of its holding in Bhilwara Energy should provide further upside. Hence, we maintain our ‘BUY’ recommendation with a price target of Rs135 on an investment perspective of one year." According to PINC research report.