Emkay has maintained ‘Buy’ rating on Punj Lloyd stock with a long term target of Rs 414.

According to Emkay, interested investors can purchase the stock on declines with a strict stop loss of Rs 265.

Shares of the company, on Thursday (July 31), closed at Rs 269.10 on the Bombay Stock Exchange (BSE). Current EPS and PE Ratio stood at 7.30 and 36.88 respectively. The share price has seen a 52-week high of Rs 589.10 and a low of Rs 183.20 on BSE.

If investors have already invested in the company’s stock, then it is wise to remain invested in the stock. The stock has great prospective. It will achieve the target price as the company has robust growth plans and strong operating potentialities.

On consolidated basis, the company has posted 88% growth in its net profit after minority interest and share of profits of associates of Rs 1,118.50 million for the three months period ended June 30, 2008, as against Rs 594.90 million during the same quarter previous year, helped by strong sales.

Total Income of the company zoomed 87.46% from Rs 14,179.50 million for the quarter ended Jun. 30, 2007 to Rs 26,581.60 million for the quarter ended Jun. 30, 2008.

The company disclosed a phenomenal increase in its standalone net profit for the same period ended June 2008. During the quarter, the profit of the company rose 3.97 times to Rs 841.20 million from Rs 212 million in the same quarter, previous year.

The company posted earnings of Rs 2.77 a share during the quarter, registering 3.18 times growth over prior year period.

Net sales for the quarter arose 2.20 times to Rs 15,585.80 million, whereas total income surged 2.18 times to Rs 15,716.10 million.

The analysts at Emkay said that this is optimistic growth for the company and melts down the looming fears and overhang on the company.

They maintain a positive view on Punj Lloyd with continued thrust in profit growth amidst healthy order backlog at Rs 201.6 billion and well-built engineering skills.

On July 18, Punj Lloyd pocketed an order from Tecnicas Reunidas, Spain for around USD 108 million.

Swissport Punj Lloyd, the joint venture (JV) between Punj Lloyd and Swissport International, is said to be in talks with National Aviation Company of India (NACIL) for undertaking its ground handling work.

It is also learnt that the JV Company is also up to date with DIAL (Delhi International Airport), MIAL (Mumbai International Airport) as well as AAI (Airports Authority of India) for the ground handling projects.

On July 3, the company received a contract from GVK Power (Govindwal Sahib), to work on the 2 X 270 MW Govindwal sahib coal fired thermal power project in Taran district, Punjab for a value of Rs 10.05 billion.

Presently Punj Lloyd is making healthy efforts to develop its market share, strengthen its business, regulates its asset quality and lays more pressure on customer service to improve its profit outlook and face growing competition.