Recommendation: Buy
CMP = Rs 82
Price target: Rs178
- Omax Auto's Q4FY2006 net sales were flat at Rs142 crore. The earnings before interest, depreciation, tax and amortisation (EBIDTA) margin for the quarter declined by 230 basis points to 8.1% mainly due to an increase in the employee and fuel costs. The profit after tax (PAT) for the quarter is down by 7% to Rs4.95 crore.
- For the full year, the sales have registered a growth of 9.2% to Rs578 crore. Exports for FY2006 were at Rs27 crore as compared with Rs15 crore in the previous year.
- The operating profit for the year rose marginally by 1% to Rs49.8 crore, as the operating profit margin (OPM) declined from 9.3% to 8.6%. The net profit for the year was flat at Rs20.04 crore as compared with Rs20.29 crore in FY2005.
- The company is aiming to double its exports in the next two years. The domestic operations are expected to recover with the stabilisation and improvement of the performance of its Bangalore and Binola plants.
- The earnings estimate for FY2007 is upgraded by 6.4% to Rs14.9 and introducing our earnings estimate for FY2008 at Rs20.8.
- At the current market price of Rs82, the stock trades at 4.1x its FY2008E earnings. I maintain Buy call on the stock with a price target of Rs178.
Recommendation: Buy
CMP = Rs 982
Price target: Rs 1,130
- Lupin to market Cefdinir suspensions
- Lupin has announced that the US Food and Drug Administration (US FDA) has approved the company's abbreviated new drug application (ANDA) for Cefdinir suspension 125mg/5ml.
