NTPC
Reco price/date: Rs 155/November 19;
Current/target price: Rs 150/Rs 175
NTPC issued fresh coal import tenders of seven million tonnes (mt) this week. This takes the tally of total coal import tenders issued in the current financial year to 17.75 mt. Tenders totaling five mt were issued in both July 2013 and August 13. Analysts believe the pace of inviting fresh bids for imported coal bodes well for NTPC's fuel security, especially since its captive coal blocks in Jharkhand are likely to witness a deferred production ramp-up, given R&R- and land acquisition linked challenges. Maintain Overweight.
-JPMOrgan
EMAMI
Reco price/date: Rs 470/November 20;
Current/target price: Rs 466/Rs 559
Emami enjoys leadership position (consolidated 60 per cent market share in four power brand categories) in cooling hair oil, balm, antiseptic cream and men's fairness cream categories, which together contributed 71 per cent of Emami's revenue in FY13. While Emami's revenue growth shall be driven by increasing penetration and distribution expansion in domestic and international markets, its domestic business underlines the need for successful new product launches or an acquisition. Analysts estimate Emami's revenue to grow at a CAGR of 15 per cent, driven by category growth and EPS to grow at a CAGR of 21 per cent over FY13-FY16 driven by Ebitda margin expansion of 400 basis points. Initiate coverage with Buy.
-ICICI Securities
BHUSHAN STEEL
Reco price/date: Rs 485/November 21;
Current/target price: Rs 482/Rs 448
Odisha Pollution Control Board (OSPCB) has directed Bhushan Steel (Bhushan) to shut down its power unit (155 Mw) and steel rolling mill at its Meramundali plant in Dhenkanal district after a blast at the site on November 14, 2013. As per OSPCB, Bhushan had not obtained environment clearance or consent of operation from OSPCB to commission its blast furnace 2, where the accident had occurred. Analysts believe that the company is likely to appeal for stay on the order of OSPCB. Meanwhile, the company may have to temporarily purchase power from outside until its captive power plant becomes operational. However, the increase in power costs is unlikely to have material impact on the company's financials. Maintain Reduce.
-Angel broking
GSPL
Reco price/date: Rs 61/November 21;
Current/target price: Rs 60/Rs 79
Gujarat State Petronet's (GSPL) transmission volume is likely to increase, as India's gas supply has bottomed out and it should increase from second half of FY15 onwards, owing to increased KG-D6 gas production and higher LNG imports. Though the increase in GSPL's outstanding debtors highlights the re-negotiation risk of 'take-or-pay' income, analysts have conservatively not factored in any take-or-pay income in their earnings estimates. However, Ambit analysts still expect a 31 per cent upside from current market price. A ramp-up in KG D6 gas production is the key catalyst. Maintain Buy.
-Ambit Capital
