Indian Stock Market

hi folks,
Please suggest stocks that you would be comfortable recommending for a Buy today, with a Buy and Hold mentality over the Long Term (defined as 2-3-4-5 years):
Name? Timeframe? Why? Buy Price Point?
Thanks.
My suggestion on the same:
Neeraj Marathe wrote Name: Usha Martin Ltd. Time frame-4 years Buy Price point- CMP
regards
> > GRASIM (BUY; TP Rs3558). 3. BHUSHAN STEEL (Downgrade to Sell; TP > Rs914) > > > > > > > > I totally agree with L&T…..Just realized the Book to Bill > ratio (order > > backlog to current bill ratio) for FY07, 08E, 09E. Just > unbelievable. > > Buy this one on any and every dip, and forget about it. It is a > huge > > Power/Construction Sector play until 2010. SIPping for initial > > investment would make it worth your while. > > > > KKP > > > > > > accurate equipments wrote: > > > >> > >> > >> *1. L&T: Downgrade to Neutral with the target price of Rs2,557* > >> - We downgrade our rating on L&T (LT IN; Mkt Cap USD18b, CMP > Rs2,589, > >> Buy) to Neutral. The company’s business fundamentals continue > to be > >> robust - during our recent interaction, the management reiterated > >> guidance of 25-30% growth in order intake and revenues, and > stable to > >> marginally higher E&C margins in FY08. Its subsidiaries also offer > >> significant value-unlocking opportunities. However, we believe that > >> current valuations factor in most of the positives and the stock > >> offers limited upside potential from current levels. > >> > >> - Current market price is higher than our SOTP-based price > target: Our > >> SOTP-based price target for L&T is Rs2,557 (22x FY09E core business > >> earnings) as against the current market price of Rs2,589. > Adjusting > >> for the value of L&T IDPL (Rs154/share) and Ultratech Cemco > >> (Rs36/share), L&T quotes at 28.4x FY08E and 22.5x FY09E EPS. Our > >> SOTP-based price target factors in (1) 29% net profit CAGR during > >> FY07-09, and (2) continued 20%+ growth beyond FY09. This leaves > little > >> room for disappointments - possible delays in project awards, > >> execution, etc. > >> > >> - Even at our best-case EPS estimates, the stock upside is > limited: > >> Our best-case EPS estimates (consolidated) stand at Rs89.8 for FY08 > >> (v/s our current estimate of Rs84.4) and Rs122 for FY09 (v/s our > >> current estimate of Rs106.8). Based on the best-case scenario, we > >> arrive at a target price of Rs2,906 - an upside of just 12.5%. > Also, > >> L&T derives 55% of revenues from the infrastructure segment, where > >> significant valuation premium (currently 38-58%) vis-=E0-vis other > >> construction companies appears difficult to justify. > >> > >> - Sizeable capex program could impact return ratios: To > increase the > >> share of manufacturing business, L&T has announced a sizeable > capex > >> program, which could impact return ratios till the new businesses > >> mature. L&T has a capex plan of Rs25b during FY08 and FY09 for the > >> standalone business, and intends to invest Rs8-10b per year in its > >> subsidiaries (L&T IDPL, L&T Finance, L&T Infrastructure Finance and > >> L&T International FZE), Rs20b in the shipbuilding business, and > Rs6b > >> in the power equipment business. > >> > >> * * > >> > >> > >> *2. GRASIM: Core businesses witnessing strong upcycle; Buy with > target > >> price of Rs3,558 * > >> - Both of Grasim’s (GRASIM IN; Mkt Cap USD6.6b, CMP 2,936, Buy) > core > >> businesses (cement and VSF) are witnessing strong business upcycle. > >> The performance of its sponge iron and chemicals businesses is also > >> set to improve. We estimate EPS at Rs281.7 for FY08 and Rs274.7 for > >> FY09. Our SOTP-based valuation of Rs3,558 indicates an upside > of 21%. > >> We reiterate Buy. > >> > >> - Cement - timely capacity addition to drive growth: With > inflation > >> waning, we see signs of attenuation of state intervention in cement > >> pricing. Demand-supply remains in the industry’s favor, and > given the > >> strong demand drivers and possible delays in new capacity > additions, > >> the upturn in the cement cycle could be prolonged. Grasim’s timely > >> capacity addition would help drive volume growth, and cost cutting > >> would enhance competitiveness. > >> > >> - VSF - momentum likely to continue: Given the increasing > preference > >> for comfort (cellulosic) fabrics, the outlook for the VSF > industry is > >> positive. ICAC estimates that cotton consumption would outstrip > >> production, leading to strong cotton prices. This in turn would > mean > >> favorable prices for VSF as well. For Indian players, the > abolition of > >> quotas is a further positive. Being the largest producer of VSF in > >> India and the second largest in the world, Grasim is a key > beneficiary. > >> > >> - Other businesses - performance to improve: Grasim’s sponge iron > >> business has suffered due to inadequate gas supplies while its > >> chemicals business was adversely impacted by a breakdown in its > >> captive power plant. While the commencement of the Dahej-Dabhol > >> pipeline in December 2007 should result in adequate gas > availability, > >> normalcy has been restored at its captive power plant. We > expect these > >> businesses to report improved performance in FY08. > >> > >> > >> > >> > >> *3. BHUSHAN STEEL: Upgrading the target price to Rs914, > Downgrading to > >> Sell * > >> - The stock price of Bhushan Steel (BHUS IN; Mkt Cap USD1b, CMP > Rs938, > >> Buy) has appreciated 43% in the last one week (up 71% since our > report > >> dated 10 May 2007). We are revising our target price from Rs713 to > >> Rs914. However, as the current market price is higher than our > revised > >> target price, we downgrade the stock to Sell. > >> > >> *Event update* > >> - Bhushan Steel has signed an MoU with L&T and Paulwurth for the > >> supply of a 2.5mtpa blast furnace worth Rs12b. This is part of its > >> next phase of expansion in Orissa to increase capacity from 1.9mtpa > >> (in March 2009) to ~4mtpa by the end of 2011. The total cost of > the > >> expansion project is ~Rs40b and the company is yet to achieve > >> financial closure for the same. We believe its aggressiveness in > >> placing the order for the blast furnace (which has the longest > lead > >> time) is to ensure a continuous stream of projects and growth. > This is > >> significant in view of the large capex being planned by the steel > >> industry in India to double production in the next five years, > which > >> is resulting in the quality equipment suppliers getting fully > booked. > >> > >> - The company currently has a capacity of 1mtpa cold rolled and > >> galvanized products, which are produced from HRC. Increase in HRC > >> prices increases the company’s raw material cost, which it is > >> generally able to pass on to the end users. Prices of steel > products > >> have started moving up in the last fortnight due to global > shortage of > >> metallic. Therefore, the prices of HRC have moved up ahead of the > >> movement in prices of galvanized steel. SAIL has increased the > prices > >> of HRC by Rs800 per ton w.e.f. September 1 while the prices of > >> galvanized sheet were left unchanged to compete with Chinese > suppliers > >> (Chinese suppliers of galvanized sheet are at an advantage due to > >> differential duty on HRC exports). > >> > >> - We expect EBITDA margins to improve substantially from 16.4% > in FY07 > >> to 36.2% in FY10 (at HRC price of Rs25,000 per ton) due to backward > >> integration. We are revising our target price upward to Rs914 > (earlier > >> Rs713), based on EV/EBITDA of 3.5x FY10E, discounted backward > 20%. As > >> the current market price is higher than our revised target > price, we > >> downgrade the stock to Sell. > >> > >> > >> > >> > >> > >> > >> > >> — > >> > >> > > > > > > > > > > > > > > > > >