vishnuvega
28-11-2007, 07:11 AM
Angel Broking has maintained buy rating on Godawari Power & Ispat (GPIL) with target price of Rs 384 with 12 month prespective, in report dated on November 15, 2007. "Godawari Power & Ispat (GPIL) is an integrated manufacturer of sponge iron, steel billets, wire rods and ferro alloys and enjoys the advantage of having a captive power plant. GPIL is expected to more than double its Top-line and Bottom-line over FY2007-09E on the back of capacity expansion of its high-margin products. We believe GPIL’s backward integration into critical raw materials such as iron ore and coal would result in a significant de-risking of its business model and lend stability to Earnings. At the CMP of Rs265, the stock is trading at 5.6x FY2009E EPS of Rs47.1. Based on the sum-of-the-parts (SOTP) methodology, we have arrived at a target price of Rs 384 valuing the mines at Rs 127 (using NPV) and steel business at Rs 257." according to Angel Broking research report.