vishnuvega
04-12-2007, 07:24 AM
HDFC Securities is bullish on Gitanjali Gems and has maintained buy rating on the stock with a 12-month target of Rs 521 as per their report on December 3, 2007. “Gitanjali Gems, GGL is best poised to capture the growth in Indian gems and jewellery sector with its strong brand equity, integrated operations and superb retail and distribution network. The business strategy of further integration within the jewellery value chain, higher margins in retail business and higher value addition would lead the company to the top league in Indian organized retail. We expect sales to reach Rs 55.7 billion (FY09E) with 26.7% CAGR over FY07- 09E, whereas net profits would grow at 67.2% CAGR over FY07-09E to Rs. 2.54 billion. The company is currently trading at 15x FY09E fully diluted EPS. We maintain BUY rating with a twelve-month price objective of Rs. 521 (with 20% upside), valuing the stock at 18x FY09E fully diluted EPS." according to HDFC Securities research report