Shahina Mukadam, IDBI Capital Market is of the view that Jaiprakash Associates is looking attractive at current level.
Mukadam told CNBC-TV18, "Fundamentally at current levels, Jaiprakash Associates is looking extremely attractive. There are couples of things that are good for the longer-term growth and valuation for the company. They have got the Taj Expressway project, which is a very large project and as part of that project, they will get to develop close to 6,250 acres of land, 5 points across this highway that joins Agra and Noida. This is not there in the valuation as of now currently, it is not reflected and but it is something that will evolve over a period of time. Even if you exclude this I think the existing business of the company there is a lot of growth momentum. As of now they have just 7 million tonnes of cement capacity which I believe is going to double in the next 12 months to 14 million tonnes."
She further added, "If you look at on EV to price per tonne it is very interestingly placed especially if you take an SOTP value assigning some value to the land on the proposed Agra Highway. In addition to this of course the EPC work that the company is doing, they have got lot of projects another Rs 2,500 crore is expected to come in revenues from this project next year and also it is in a much complex area, the EPC contracts is in the Hydro power area, which definitely offers better scope of margins. All in all valuations are not stretched at around Rs 30 EPS with the current price level. I think it is extremely and attractively priced."
Link to the article: http://www.moneycontrol.com/india/news/stocks-views/jaiprakash-associates-looks-attractive:-mukadam/327247
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