Buy PTC India Ltd - Motilal Oswal

PTC India (PTCIN IN; Mkt Cap USD0.5b, CMP Rs81, Buy)

3QFY11 financial performance above estimates, given higher retained rebates, etc: During 3QFY11, PTC India's reported net profit of Rs354m (up 125% YoY).

Power trading business expected to double volumes till FY13: Long term (LT) power portfolio comprises 2.3GW and will add 1.4GW in FY12, 4.5GW in FY13.

PTC has signed Power Sale Agreement for 3,594MW of projects cumulatively. This excludes ~3GW of capacities where PTC has emerged as the lowest bidders.

PTC has cash and cash equivalent of Rs11b, and has investments of Rs7b into subsidiaries/project SPVs. We expect PTC to report consolidated net profit of Rs1.6b in FY11E (up 45% YoY), Rs3.1b in FY12E (up 88% YoY) and Rs4.2b in FY13 (up 36% YoY). The stock trades at reported PER of 14.3x FY11E, 7.6x FY12E and 5.6x FY13E. Maintain Buy, with Price target of Rs144/sh (upside of 80%).

Source : Equity Bulls

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