Accumulate Exide Industries: Angel

Angel Broking has recommended an accumulate rating on Exide Industries in its April 22, 2008 research report. "For 4QFY2008, Exide Industries clocked 49.6% growth in Net Sales to Rs 791.3 crore, which was in line with our expectation of Rs 793 crore. However, the company’s Bottom-line, which recorded 63.9% yoy growth in Net Profit to Rs 62.8 crore, came in slightly above our expectation. We had estimated Net Profit of Rs 59.8 crore for the quarter."

"We believe Exide is a good long-term investment pick in view of its strong financials. It is a fundamentally sound company, with Operating Margins of around 15% and has been consistently clocking RoE and RoCE of above 20% over the last three years. High Return Ratios are likely to keep Exide’s Earnings multiple above 14x. At the CMP, the stock is quoting at 16.7x FY2010E Earnings. We value its stake in ING Vyaya Life Insurance at Rs 17 per share on 15x FY2010E New Business Arrived Profit (NBAP) and at adjusted valuation of 13x FY2010E Earnings for its core business. We recommend Accumulate the stock at lower levels," says Angel's research report.

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