Hem Securities recommended a BUY on Voltas (CMP: Rs 163) with a target price of Rs 235.
The company posted good results for the quarter ended Q3FY08. The net sales for the company surged to Rs 6,648 million for the Q3FY08 as against the net sales of Rs 5,689 million for the Q3FY07 with growth rate of 17%. The company with diversified business model along with competitive advantage is poise to grow strongly. The analysts at Hem Securities say that the company has very efficiently and effectively utilized its resources to generated wealth for its capital providers. It is well positioned among its peers to meet future challenges and to magnify its earnings with strong order book and growing demand for its products.
The company has emerged from being a consumer appliance company operating in highly competitive arena to one that has expertise in the niche engineering area of electro mechanical projects and services. The analysts believe that this has the potential to take the company on to a high growth trajectory in the future. The stock at the current market price of Rs 163 will trade 26.16 times to its earnings and 10.11 times to its book value and is expected to provide huge upside potential in medium to longterm.
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