Dear All,
Please find attached details of Debut-7 Stock: Hitachi Home & Life Solutions (India) Ltd
Kindly click on the following link to view the Report.
| BUY | |
| CMP | Rs 224 |
| Target Price | Rs 275 |
| Investment Period 6 Months | |
HHLS India is a subsidiary of Japan-based Hitachi Home & Life Solutions, Inc. The company operates in the air conditioner (AC) industry, which is expected to grow at a 15% CAGR over FY10–2015 due to its low penetration level of ~3% in the Indian market. We expect HHLS to witness an 18% CAGR in revenue over FY2010–12. The company’s EBITDA margin is expected to improve by 300bp to 8.3% in FY2012 from 5.3% in FY2011, owing to a 3–4% increase in product prices across all categories and higher market penetration coupled with passing off of the increase in the price of its key raw material (copper). PAT will likely witness a sharp rebound from `19cr in FY2011E to `44cr in FY2012E on the back of margin improvement and increased operating leverage. Currently, at `224, the stock is trading at PE of 27.3x and 11.7x its FY2011E and FY2012E earnings, respectively. We recommend Buy on HHLS with a target price of `275, based on target E of 14x for FY2012E.
If you have any further queries, feel free to call us on 022 39357600, Extn: 6864 / 6865 or mail us at advisory@angelbroking.com
With best regards,
Fundamental Advisory Desk
Angel Broking
Akruti Star,6th Floor, Road No.7,MIDC, Andheri (E),Mumbai – 93.
Call : (91) (022) 39357600 Ext. 6864,6865
Website : www.angelbroking.com
Disclaimer: Ours is an advisory role. The final decision and consequences based on our information is solely yours. Moreover, in keeping with regulatory guidelines, we do not guarantee any returns on investments. Prospective investors and others are cautioned that any forward-looking statements are not predictions and may be subject to change without notice.
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