Re-iterate ACCUMULATE on CRISIL Limited - Destimoney Securities

Destimoney Securities has re-iterated its ACCUMULATE rating on CRISIL Limited (CRISIL) with a revised target price of Rs.1,110 per share.

Destimoney had initiated coverage on Crisil Limited (Jun 16 2011) with a ACCUMULATE rating based on the growth in the company's rating business, especially, its bank loan rating business.

While maintaining its leadership position in rating business, Crisil reported 29.7%YOY revenue growth in Q1CY12. The company's operating margin witnessed 381 bps expansions during the quarter. The 25,000th SME rating was assigned during the quarter. Outstanding ratings number has increased 22 times in last four years from 400 to 9,000.

The Company's global research & analytics business, consisting of Irevna and Pipal Research, has maintained its leadership despite challenging global conditions, as former caters to a premiere offshore research provider to the financial sector, while the latter provides offshore research services to the corporate sector.

Crisil expects loan structuring to the tune of Rs. 2 trillion during Mar'13 to bring good business opportunity.

The company has been rewarding its shareholders with regular dividends and share buy-back.

Destimoney is optimistic towards long term potential of Crisil's rating business; however remain watchful towards improvement in macro environment.

Source : Equity Bulls

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