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Asahi India Glass can touch Rs 80: SP Tulsian

Post Time:Apr 20,2012Classify:Company NewsView:252

 

SP Tulsian, sptulsian.com is of the view that Asahi India Glass can touch Rs 80.

 

Tulsian told CNBC-TV18, "In last one week if you see all the auto ancillary, rather the whole sector is coming into the focus. Subros , Jai Bharat Maruti, Wheels India , ZF Steering , in fact all the stocks and even the Saint-Gobain though that maybe on the delisting. So I thought that Asahi India Glass is again a best pick amongst the auto ancillary sector. This is the largest automotive and float glass maker in the country."

 

He further added, "In the company 55% stake is held by three promoters, 11% by Maruti, 22.22% by the Asahi Japan who are the technical collaborators and remaining about 22% by the Labroo family. If you see the shareholding pattern about 35% of the remaining 45% is held by the HNIs and if you see in that breakup five or six HNIs are holding 20-22% stake in the company."

 

"They have 27% market share in the float glass and 77% of the passenger cars are controlled by this company and they have 11 plants catering to practically each passenger car maker in the country and if you see the financial performance for first nine months it has not been very great but at least the company has not been a cash loser."

 

"Company made a cash profit of close to about Rs 60 crore on a top-line of about Rs 1,250 crore for first nine months while the cash profit in FY11 was close to about Rs 145-150 crore. But I think going forward from hereon the glass makers, the pricing power is coming back. Saint-Gobain which is seen a delisting candidate also seems to be have good plans going ahead because they have acquired the float glass of Sezal Glass about three-four months back."

 

"So taking these combined reasons a positive view on auto ancillary sector, the financial performance of the other companies and the positioning of the Asahi India Glass. I think that this stock looks quite good at Rs 60 and if somebody can keep a view of about six months or so can see a price of about Rs 80."

 

Source: http://www.moneycontrol.comAuthor: shangyi

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