Buy ABG Shipyard, target Rs 870: HEM
Hem Securities has recommended a buy rating on ABG Shipyard with a target price of Rs 870 in its April 1, 2008 research report. “The company has strong future potential due to its De-Risked Business Model as the company has capability to manufacture vessels for different sectors viz oil & Gas, bulk trade and short sea trade, strategically located shipyards which helps the company in consolidation of overheads and in turn lowering the cost as well as getting synergies of scale and low cost of production due to lower capex. The stock is currently trading at P/E multiple of 25.57 while the price to book value ratio of the company stood at 5.43. Looking at the present financials and future growth prospects of the company we initiate the “Buy” signal on the stock with the price target of 870 in medium term”, says HEM’s research report.
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