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Date: November 26, 2008
Ref. No. MPML/BB/204/061/2008

 

Dear Sir,

Sensex is trading at 8700 levels. These are the levels where one should start buying stocks with good fundamentals and growing out look. Capital goods sector is one of the growth drivers for Indian economy. In present scenario in Stock markets these stocks have fallen down drastically even after posting good Q2 financial results. The future growth is strong in this sector. We are suggesting you replica of L&T Ltd, Punj Lloyd Ltd at current market rate.


Punj Lloyd Ltd. :

CMP
133
52 Week High
589
52 Week low
134.5
Market Capital
10116 Cr
P/E
11.62

Punj Lloyd is India's second-largest engineering and construction firm, with unmatched experience in pipeline and storage-tanks. The company provides engineering, designing, procurement, construction and project management services for energy industry and infrastructure sector. Punj Lloyd Ltd. may emerge as a credible alternative to L&T in some segments over the next few years.

Punj Lloyd net profit rose 180.68 Percent to Rs.88.05 cr in Qtr ending September 2008 for the financial year 2008-2009 Compared to Rs.31.37 cr in qtr ending September 2007. Sales rose 52.47 Percent to Rs1583.52 cr in Qtr ending September 2008 for the financial year 2008-2009 Compared to Rs.1038.57 cr in qtr ending September 2007. The current price of Rs.135 discounts the company's Q2 September 2008 annualized EPS of Rs11.61, by a PE multiple of 11.62.

The company had an order backlog of Rs 21,675 crore as on 30 September 2008.

Punj Lloyd is a very strong Mid cap company, it tracks the energy story, it's a great business model and there are very few companies that are equivalents to a specialized oil and energy construction company in India. Punj Lloyd having corrected viscously almost 77% from Rs.589 levels to current level of Rs.133. This will be a great opportunity for an investor with long term as well as short-term view. We suggest you to buy this stock below 130 levels.

Awaiting your Quick Response.

Thanks & Regards,
PMS Department