Bhushan Steel
Reco Price: Rs 350
Target Price: Rs 372

Bhushan Steel (BHUS) posted in-line EBITDA of INR7.2b for 3QFY12. Adjusted PAT increased 34% QoQ (declined 1% YoY) to INR2.8b, higher than our estimate of INR1.9b. This is because fluctuations in forex value of payables led to lower than expected interest cost.  Net sales declined 2% QoQ to INR24.1b on lower steel sales tonnage but higher steel realization. Sales tonnage decreased 7% QoQ to 513k tons, as previous quarter sales were boosted by liquidation of HRC inventories. Average steel realization increased 5% QoQ to INR46,936/ton. Flat product sales tonnage decreased 8% QoQ to 430k tons while realization increased 5% to INR49,121/ton. Long product sales declined 4% QoQ to 83k tons. Average realization increased 5% QoQ to INR47,212/ton. Sponge iron kilns were shut-down earlier to comply with environment norms. Six out of 8 kilns have restarted.  Stock trades at expensive EV/EBITDA of 9.5x FY12. Maintain Neutral.
                                                                                                                                                                                                                           - Motilal Oswal

Ranbaxy Laboratories
Reco Price: Rs 475
Target Price: Rs 355

Given the delay in entering consent decree with the USFDA we expect the clearance of the facilities to be long time driven and costly process (over and above the provision of USD 500mn made) which would impact the base operating margins of the company. Although the names of FTFs surrendered have not been disclosed, we expect it to be generic Provigil, Diovan and Valcyte contributing sales to the tune of USD186mn and NPV of Rs12 per share. The stock is currently trading at 29.2x and 20.3x its CY12E and CY13E recurring earnings respectively. We continue with our negative outlook and downgrade the stock to ‘Sell’. We value the core business at Rs329/share (22x one year forward recurring earnings), FTF pipeline at Rs81/share and reduce Rs55/share for the penalty provision resulting in revised SOTP based target price of Rs355.
                                                                                                                                                                                                                         - Pinc Research


NHPC
Reco Price: Rs 21
Target Price: Rs 22

Revenues from operations at Rs7.7bn (PLe: Rs7bn) for Q3FY11, flat YoY, was on account of underutilisation of operating capacities, with generation down by 5.8% YoY. The company has included items in revenues to the tune of Rs1.1bn, mainly arising out of water cess billing and recovery of tariffs and interest on that amount. Expenditure also had major extraordinary items of Rs800m pertaining to provisions created for Kotli Bhel Stage-1&2 projects, as these projects have less chances of getting approved by MOEF. NHPC currently has been lagging behind in terms of capacity addition which will lead to a flat generation growth in FY12E. We have changed our estimates to factor in capacity delays and adverse effect of Parbati 3 capitalisation into FY13E and beyond numbers. We have, thus, reduced our target price and believe that the stock is fairly priced with negative bias. The stock is trading at a P/BV of 0.9x FY13E/14E. We maintain ‘Accumulate’ just because it is the safest play (non-fossil fuel) in the Power Sector, but lower our target price from Rs24.
                                                                                                                                                                                                              - Prabhudas Lilladher