Steel Sector : Price controls lifted. Possible opportunity.
SAIL (CMP: 127):
India Bulls Analyst Report Dated June 1 [buy recommendation at 137]
http://www.business-standard.com/pdf/TU556%20SAIL%20080701.pdf
+points
Debt Equity : 0.22
PE : 6
07 - 08 PAT growth : around 16 %
Steel Prices rising
85% promoter holding
-points
Government Control
5.41 % FII holding - could lead to a further call
Expansion Project overruns
Higher Raw material prices eating into margins
Conclusion : I am not very comfortable with capital intensive industries. Could wait for a further fall. Will take a look at this if I do not find better companies.
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