IVRCL Share : Targer Price Rs. 60.

IVRCL has bagged orders aggregating to Rs. 972 cr across its transportation and
mining divisions. The transportation division is the major contributor with orders
worth Rs. 918 cr.

IVRCL’s order book Rs. 25,303 cr

The mining division contributed orders worth Rs. 54 cr. With these
orders, IVRCL’s order book stands at Rs. 25,303 cr (4.5x FY 2011 revenue). This is
positive for the company as there has been a dry spell of order inflow across
sectors since the last couple of quarters with the road sector being the only
exception.

We have valued IVRCL on an SOTP basis. The company’s core construction
business is valued at P/E of 7x FY 2013E EPS of Rs.6.1 (`42.7/share), whereas its
stake in subsidiaries IVRCLAH (`12.8/share) and Hindustan Dorr-Oliver
(`4.5/share) has been valued on mcap basis, post assigning a 20% holding
company discount.

At the CMP of Rs.41, the stock is trading at P/E of 6.8x FY2013E
EPS and 0.5x FY2013E P/BV on a standalone basis and adjusting for its
subsidiaries at P/E of 3.9x FY2013E EPS, which we believe is at attractive
valuations.

Therefore, on the back of the company’s robust order book-to-sales
ratio and attractive valuations, we maintain our Buy recommendation on the stock
with a target price of  Rs. 60.

Review by Angle Broking

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