Retain 'buy' on SAIL - TP maintained at Rs.100 - Geojit BNP Paribas Financial Services

- The stock is currently available in the range of Rs.78.

- 3QFY13 operating performance was weak with EBITDA missing market estimates.

-While sales volume and ASP (average sales price) missed estimates, the EBITDA miss was minimized by lower than expected CoGS (cost of goods sold) /ton.

- Other income and interest expenses exceeded estimates resulting in miss in recurring PAT.

- While Indian steel demand was sluggish in 3QFY13, SAIL mentioned that sales volumes picked up in January and thus it expects to liquidate about 0.7million tons of inventory in 4QFY13.

- On projects, while SAIL has pushed out timelines by three to six months, it has guided to no further delays in project commissioning.

- It is expected that phased commissioning of projects from 4QFY13 should regain any loss of investor confidence in SAIL's abilities to execute its capex program and this may drive a re-rating of the stock.

- Key risks to the TP are further delays in projects commissioning, fall in iron ore prices and continuation of coke availability issues.

Source : Equity Bulls

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