Microsec Capital has recommended 'Buy' on Thermax with target price of Rs 1,100 as against current market price of Rs 896 in its report.
Commenting on the investment rationale, the stock broker said, ''We rate Thermax India. (TMX) a Buy. TMX provides a range of engineering solutions to the energy and environment sectors, aided through a combination of technology and strategic alliances. TMX derives 80% of its orders from mid- to late cycle capex by sectors like metals, cement, refineries and power.
We expect a U-shaped economic recovery in India, on the back of faster clearances for projects by the new government at the Centre, which would catapult a gradual restoration in corporate capex.
We see upside momentum of TMX's earning for FY15E and forecast a PAT CAGR of 18% over FY14-FY16E. TMX holds the potential to outperform, once growth revives in FY15E.Therefore we recommend a Buy with a target price of Rs 1,100.''
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