 "Broker alert: Why Sterlite and Cairn India are hot favourites")
Firstpost tries to make your life easier by offering you a list of stock recommendations from various brokerages houses. Here’s the list:
•Motilal Oswalis bullish onSterlite Industrieswith a buy price of Rs 151 per share against its current price of Rs 113 per share, a growth of almost 33.6 percent. According to the report, the company’s earnings are likely to be driven by volume in the zinc and lead business. In addition, the commissioning of the 1,200 mega watt (mw) power plant in the next few quarters, along with the opening of the captive coal mine, is expected to lead to a quantum jump in profits because of low production costs. The commissioning of Sterlite Energy’s 600 mega watt unit will also drive earnings. Over the past year, the stock has fallen by 31 percent.
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•Bank of America Merrill Lynch is bullish on Cairn India with a price target of Rs 383 per share compared with its current price of Rs 342 per share, reflecting a growth of 12 percent. It expects the company to report strong earnings in growth for the year ended March 2012 and March 2013 due to a jump in oil output from its main Rajasthan block, high oil prices and a weak rupee. While production from its main Rajasthan block is set to jump to 240,000 barrels per day by 2013, there is still further scope for an increase in reserves and higher peak production, the report said. Apart from this, Cairn has also made discoveries in Sri Lanka and its KG onshore block in the past two years. Vedanta also finally acquired a 58 percent stake in Cairn India for a whopping $6.5 billion.
•Prabhudas Lilladher has a ‘buy’ rating on Peninsula Land with a price target of Rs 47 per share. The stock is trading at Rs 37, reflecting a growth of almost 27 percent. The completion of Peninsula Business Park augurs well for the company as it has already sold two floors in the park, while one floor has been leased. The brokerage expects the company’s net debt to start trending lower as the cash flows come in from the completion of the park. While the year ended March 2012 may lead to a more than 40 percent fall in revenues and profits, financial year 2013 (April-March) is expected to be better because of a slew of launches.
•KR Choksey continues to maintain its ‘‘sell’ rating on Bank of India with a target price of Rs 300 per share. It is currently quoting at Rs 336 per share. While the company’s profits exceeded market expectations for the December-ending quarter, weaker loan growth, tepid fee growth, higher restructuring and relatively higher slippages from restructured books were key disappointments. Over the past one year, the stock had fallen by 27 percent compared to the Sensex, which fell 8 percent.