ICICIdirect recommended 'Buy' on Bajaj Electricals(BEL) with target Rs 416 against market price of Rs 293 on Sept 1.

Commenting on the investment rationale, the stock broker said, "Bajaj Electrical's engineering & project (E&P) division has bagged four orders of Rs 6.02 billion under the TLT and special projects categories.With an expected turnaround in the E&P business from FY15E onwards and continued dominance in the lighting & CD business, we expect BEL to generate EBITDA of Rs 3.15 billion in FY15E and Rs 4.30 billion in FY16E.

We believe the stock is trading at attractive multiples considering the turnaround in the E&P segment. We have valued the CD, lighting and E&P business at 12x, 6x and 6x FY16E EBITDA, respectively, to arrive at a target price of Rs 416 a share with a Buy recommendation."

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