Hold Aditya Birla; target of Rs 968: Sharekhan
Sharekhan has downgraded its rating on Aditya Birla Nuvo to hold with a price target of Rs 968 in its report dated June 9, 2009.
“Aditya Birla Nuvo Ltd’s (ABN) board of directors has decided to issue 1.85 crore warrants worth Rs 1,000 crore (at a conversion price of Rs 540.45 per share) to the promoter group on a preferential allotment basis subject to shareholders’ approval on June 17, 2009. The money thus raised would be utilised mainly for the expansion of its insurance branch network. At the current market price, the stock trades at an EV/EBIDTA of 17.6x FY2010E. Given the diverse businesses of ABN, the company is best valued using the sumof-the-parts method. We have increased our price target for ABN to Rs 968 due to re-rating of its insurance business and improvement in the valuation of its telecom business. We are downgrading the stock to a Hold rating due to the steep run-up in the stock price.”
source: Moneycontrol
Tags: aditya birla, bse tips, nse bse tips, NSE Tips, share market, sharekhan, short term views, stock market, stock market india
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