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Buy KPIT Cummins; target of Rs 123: Firstcall Research
22 Jun 2012 02:44 PM
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Firstcall Research is bullish on KPIT Cummins and has recommended buy rating on the stock with a target of Rs 123 in its June 20, 2012 research report.

KPIT Cummins Infosystems Ltd has reported net profit of Rs 437.14 million for the quarter ended on March 31, 2012 as against Rs. 263.32 million in the same quarter last year, an increase of 66.01%. It has reported net sales of Rs 4800.09 million for the quarter ended on March 31, 2012 as against Rs 3081.98 million in the same quarter last year, a rise of 55.75%. Total income grew by 50.83% to Rs 4697.46 million from Rs.3114.47 million in the same quarter last year. During the quarter, it reported earnings of Rs 2.46 a share.

KPIT Cummins Infosystems Ltd is a leading technology solutions partner for global Manufacturing corporations with special focus on automotive, energy & utilities, industrial corporations with special focus on Automotive, Energy & Utilities, Industrial Equipments, and Semiconductor industries. The companys Information solutions help its customers run their businesses more efficiently. Our Product Engineering solutions enable our customers to build products that are energy efficient, safer and yield more comfort for their customers. Our highly focused approach has helped us pioneer innovative solutions and file 38 patents in the Automotive and Semiconductor domains. Leveraging our technology and domain prowess, we partner with our customers to cocreate transformational value that provides sustainable competitive advantage to businesses. Through our recognized expertise in architecting futuristic engineering and enterprise solutions, we help our customers bring advanced products faster to their target markets.

At the current market price of Rs.108.05, the stock is trading at 10.77 x FY13E and 8.94 x FY14E respectively. Earning per share (EPS) ofthe company for the earnings for FY13E and FY14E is seen at Rs.10.05 and Rs.12.11 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 28% and 32% over 2011 to 2014E respectively. On the basis of EV/EBITDA, the stock trades at 6.63 x for FY13E and 5.61 x for FY14E. Price to Book Value of the stock is expected to be at 2.12 x and 1.71 x respectively for FY13E and FY14E. We expect that the company will keep its growth story in the coming quarters also. We recommend BUY in this particular scrip with a target price of Rs 123 for medium to long term investment, says Firstcall Research report.

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To read the full report click on the attachment

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