We return very positive after the visit of the Taloja Plant and meeting the management of CMI FPE on Jan 7, 2010. The management was highly optimistic on the near term performance as well as long term outlook for the Company. Based on strong order intake & pipeline, accelerated project execution, enhanced pricing power and increased efficiencies, we expect a sharp surge in the earnings of the Company to Rs80 and Rs125 in FY10E and FY11E respectively. We strongly reiterate BUY on the stock with a price target of Rs1500 by September 2010 and Rs2400 by September 2011.
--- Strong order execution & sharp improvement in profitability in H2FY10.
--- Massive order intake of >Rs400Crores over the last month
--- Targeting revenues to more than double to Rs1100-1200 Crores over next three years
--- Future Industrial Strategy being chalked out to scale up the business
--- Strongly reiterate BUY on the stock with a price target of Rs1500 by Sept'10 and Rs2400 by Sept'11
For details, please see the note enclosed.
Anand Shah
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