Savita Oil Technologies Ltd. - InvestmentGuruIndia

Outlook and Conclusion
At the current market price of Rs.532.00, the stock is trading at 5.70x FY12E
and 4.88 x FY13E respectively.
Earning per share (EPS) of the company for the earnings for FY12E and FY13E
is seen at Rs.93.35 and Rs.108.93 respectively.
Net Sales and PAT of the company are expected to grow at a CAGR of 23% and
23% over 2010 to 2013E respectively.
On the basis of EV/EBITDA, the stock trades at 3.32 x for FY12E and 2.87 x for
FY13E.
Price to Book Value of the stock is expected to be at 1.46 x and 1.12 x
respectively for FY12E and FY13E.
We expect that the company will keep its growth story in the coming quarters
also. We recommend ‘BUY’ in this particular scrip with a target price of
Rs.601.00 for Medium to Long term investment.
Industry Overview
India’s oil and gas sector holds strategic importance in the economy as it meets
around 42 per cent of the country’s primary energy demand and contributes over 15
per cent to the gross domestic product (GDP). With an interesting mix of private and
government companies, the industry is scaling new heights in domestic and
international markets.
With a strong resource position, India ranks second (behind Australia and ahead of
Vietnam), in BMI’s upstream Business Environment ratings while the country shares
first place with China in BMI’s downstream Business Environment ratings. The
recently released BMI forecasts state that India will account for 12.4 per cent of Asia
Pacific regional oil demand by 2015, while satisfying 11.2 per cent of the supply.
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