| Himadri Chemicals Reco: NOT RATED CMP: Rs505 Target Price: NR 1st Step - 80,000 MTPA Capacity, Positive Bias Himadri Chemicals & Industries' (Himadri) Q4FY10 results were below expectations - (1) 87.4% yoy growth in revenues to Rs1.6 bn (2) operating profit increased 190.2% yoy to Rs443 mn, driven by healthy revenue growth and base effects in Q4FY09 and (3) adjusted net profit grew by 164.2% yoy to Rs272 mn - yet performance was below estimates. The key reason for deviation was contribution from 80,000 MTPA distillation facility in our estimates - which could not commence operation. Himadri improved on utilization of Carbon Black in Q4FY10 and entire 12-MW power plant commenced operations. Company reiterated expansion plan for near 2.5X increase in distillation capacity (169,000 MTPA to 400,000 MTPA), 0.8X increase in Carbon Black capacity (50,000 MTPA to 90,000 MTPA) and 6X increase in SNF capacity (8000 MTPA to 64000 MTPA) in next 3 years. Consequent to fresh issue of equity shares to Bain Capital in January 2010 – we had introduced rough cut estimates of Rs35.8/Share and Rs50.1/Share for FY11E and FY12E. We maintain our earnings estimates for FY11E and FY12E. The earning estimate for Himadri is based on our modeling for demand and supply in India and accompanying expansions undertaken by the company. The JV in China to construct 100,000 MTPA green-field distillation facilities could yield upsides to FY12E earnings estimates. Himadri is available at attractive valuations of PER 14.1X FY11E and 10.2X FY12E. We continue to hold positive bias. TRF Reco: HOLD CMP: Rs896 Target Price: Rs882 Aggressive plans in automotive, Maintain 'HOLD' Led by (1) bad debt provisions of Rs50 mn (2) prior period expenditure of Rs24 mn and (3) operating loss in automotive business- TRF Q4FY10 consolidated performance was below expectations. The reported results are (1) revenues grew by 3.0% yoy to Rs2.6 bn (2) operating profit decline by 56% yoy to Rs160 mn and (3) APAT decline by 61% yoy to Rs80 mn – below our estimates. The automotive business posted operating loss of Rs7 mn versus operating profit of Rs19 mn in Q3FY10, resulting in weak Q4FY10 performance. TRF is extremely confident on the growth plans in automotive business. Since, the business is under ramp-up phase in FY11E, operating margins are likely to remain benign. Consequently, FY11E earnings are revised downwards by 11% from Rs70.6/Share to Rs63.2/Share. But, we maintain our FY12E earnings at Rs88.2/Share. We continue to remain bullish on core MHE business amidst (1) quality order book at Rs16.4 bn, (2) forward order book cover at 2.5X revenues (3) satisfactory progress in key projects – minimizing probability of negative earning surprises. We maintain our positive bias and 'HOLD'' rating. We revise our price target from Rs780/share to Rs882/Share, changing target PER multiple from 8.9X FY12E earnings to 10X FY12E earnings. NTPC Reco: ACCUMULATE CMP: Rs197 Target Price: Rs220 Valuations Attractive; Upgrade to 'ACCUMULATE' NTPC reported net profit of Rs20.2bn (up 3.4% yoy) in Q4FY10, slightly below our estimate of Rs20.7bn – mainly attributed to negative previous year sales of Rs736mn. Key highlight of the quarter was increase in PLF (+940bps yoy) of gas based plants due to increased gas supply. In the quarter there was an income tax reversal (depreciation related) of Rs7.2bn which was reduced from the effective tax and revenues (due to pass on to beneficiaries). Consequently, there was on impact on the profit for the quarter. Apart from this there weren't any significant extraordinary items. For FY10, NTPC's standalone adjusted EPS stood at Rs10.3/Share. The consolidated earnings stood at Rs10.4/Share, implying that subsidiaries (mainly due to RGGPL) have reported profit of Rs1.1bn this year versus loss of Rs1.1bn in FY09. NTPC has added 990 MW in FY10 (lower than our estimate of 2GW). Thus, we marginally lower (3%) our FY11E earnings estimates to Rs11.2/Share. Going forward, we expect capacity addition of 7040MW in FY10-FY12E and marginally increase (2%) our FY12E estimates to Rs12.8/Share. We have not factored merchant sale out of Korba and Farakka plants in FY11E and FY12E - which could result into 1.5% (merchant rate assumption - Rs3.5) upside to the core ROE of 28% in FY12E. At CMP of Rs197, the stock is trading at 2.2x FY12E Book Value and 15.3x FY12E earnings. We are upgrading the stock to 'Accumulate' on the back of (1) huge underperformance in past one year and consequently attractive valuations, (2) core project level ROE of 28% and (3) likely upside from merchant sales. Based on its core ROE of 28% in FY12E, we have assigned multiple of 2.8x (cost of equity of 10%) to its core book of Rs602bn and multiple of 1x to its equity financed cash and equivalents of Rs133bn. Consequently, we have arrived at a price target of Rs220/Share (from Rs204/Share). We upgrade the stock to 'Accumulate' rating. Century Plyboards Reco: BUY CMP: Rs53 Target Price: Rs80 Upgrade earnings – Maintain BUY Century Plyboards (CPL) Q4 & FY10 numbers are ahead of our expectations on account of better than expected performance of power division and higher other income (forex gain). Revenues for the quarter stood at Rs3.25 bn (+19.3% yoy), driven by 15% growth in cement segment, 20% growth in plywood & laminates segment (P&L) and 88% growth in power segment. EBITDA at Rs 634 mn grew by 169% on account 42% growth in EBIT of power segment and EBIT of Rs50 mn in P&L segment (Q4FY09 Plywood & laminate segment reported negative EBIT of Rs72mn). Cement segment EBIT grew by 5% yoy. CPL has reported Rs 82 mn of forex gain in Q4FY10 as compared to Rs17 mn of forex loss. Consequently net profit for the quarter at Rs510mn grew by 283% yoy. We would like to highlight that cement segment in Q4FY10 has seen net realisation of Rs4938/ton implying FY10 (March 2010) exit prices of cement closer to ~Rs310/bag far higher than our FY11 expectations Rs280/bag. Consequently on account of better than expected cement realisation and better than expected profitability of the power division we are upgrading our FY11 earnings by 7% for FY11E (EPS of Rs5.8) and for FY12E by 12% (EPS of Rs9.9). CPL is all set to capitalize on the demand supply gap in the NER region with its cement capacity set to expand from current 1.2mtpa to 4.4 mtpa by mid FY12. Further its new CFS at Jingira pool at Kolkata with a capacity of 1,20,000 TEUs (current capacity of 40000 TEUs) is all set to start operation by Q2FY11. The kick-start of volume led growth in cement revenues and full scale operations of the CFS business in FY12 will lead to accelerated growth and significant improvement in its return ratios. Maintain BUY with a target of Rs80. | 
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