Buy Bartronics, tgt Rs 312: Angel Broking

Angel Broking has maintained buy rating on Bartronics India with target price of Rs 312 in its May 08, 2008 report. "Bartronics India (BIL) reported an outstanding 495% yoy growth in its 4QFY2008 Top-line. This was a result of impressive growth in its Automatic Identification and Data Capture (AIDC) Solutions business, specifically in the RFID Solutions business, as also contribution from the Smart Cards segment. Apart from this, as may be recalled, BIL had acquired a US company towards early 2008, which contributed Rs 33 crore to Topline. Strong growth in sectors like Retail has led to robust growth in the company’s RFID Solutions business. BIL provides end-to-end solutions in this space, including pilot testing and software integration." 

" Going ahead, we expect BIL to record a CAGR growth of 60% in Top-line and 53% in Bottom-line over FY2008-10E. We estimate Margins to be stable to slightly negative. At the CMP, the stock is trading at 7.2x FY2010E EPS. We maintain a Buy on the stock, with a revised 12-month Target Price of Rs 312 (Rs 364), downgraded on account of lower estimates for the company’s Smart Cards Business owing to the under-performance witnessed this fiscal. However, our estimates do not factor in any potential acquisitions that BIL is likely to carry out, particularly in Europe. To the extent that the company does make any profitable acquisitions going ahead, there exists an upside to our estimates." says Angel Broking report.

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