Stock market analysts have maintained ‘buy’ rating on Gujarat Alkalies & Chemicals Ltd (GACL) with an intraday target of Rs 118.50.

According to them, interested traders can purchase the stock above Rs 117 with a strict stop loss of Rs 115. If the stock markets remain on the positive path then the stock price will hit a target above Rs 122.

Shares of the company, on Monday (Nov 16), closed at Rs 116.30 on the Bombay Stock Exchange (BSE). The share price has seen a 52-week high of Rs 139.70 and a low of Rs 53.50 on BSE. Current EPS & P/E ratio of the stock stood at 17.46 & 6.69 respectively.

GACL has decided to strengthen its hydrogen peroxide and caustic soda making capacity.

The state-owned company is also establishing a stable bleaching powder facility at Dahej in Gujarat.

As part of its overall growth projects comprising an investment of Rs 26 billion, the company declared 3 new projects that consist of hydrogen peroxide stage-III, caustic soda development and stable bleaching powder entity.

The company plans to invest upto Rs 1 billion for third phase growth of hydrogen peroxide manufacturing capacity at its subsisting plant in Dahej.

Post expansion, GACL’s manufacturing capacity will reach hit 39,000 tons annually.

During Oct 2009, credit rating agency, CARE retained the AA ranking allotted to the long-standing bank facilities and retained the PR1+ score allotted to the temporary bank facilities of GACL. This ranking is pertinent for facilities having tenure of over twelve months.

Plants having AA rating are believed to provide high protection for timely servicing of debt obligations and with PR1 rating would have strong capacity for timely payment of short-term debt obligations and hold lowest credit risk.
 
The credit rating agency allots `+` or `-` signs to be pointed after the assigned rating to point out the relative position within the band covered by the rating symbol.