MOIL looks attractive, may see an upside of 40%: Emkay
The initial public offering (IPO) of MOIL (formerly Manganese Ore India) will open for subscription on November 26. Emkay Global Financial Services has recommended subscribing the issue, in its research report November 24, 2010.
MOIL offers 336 lakh equity shares through IPO, which is an offer for sale for cash by The President of India, acting through the Ministry of Steel, Government of India, Government of Maharashtra and Madhya Pradesh. The issue will close for institutional bidders on November 30 and for other investors on December 1.
The report says, “MOIL is the largest manganese ore producer in India, contributing 50% of the total domestic production. Globally it ranks fifth among all the manganese producers. The company is among the lowest cost manganese ore producers with an EBITDA margin of 70% during H1FY11. It has 22 mt of good quality manganese ore reserves. It is a debt free company with net cash of Rs 105 per share during H1FY11. The company has a planned capex of Rs 7680 million to ramp up its capacity to 1.5 mtpa by FY16. At the upper band of Rs 375, the stock looks attractively valued with potential upside of 40% on 6x FY12E EV/ EBITDA basis – recommend subscribe.”
Source:- Moneycontrol
