Sesa Goa went ex-bonus (1:1) and ex-split (10:1) on August 8 2008, which means that there are now 20 shares trading of face value Re1 per share against each share traded earlier with a face value of Rs10 per share.
We are realigning the target price and earning per share estimates while keeping intact the earlier revenue and profitability estimates and valuation.
Realigned forecasted EPS for FY09E and FY10E works out to Rs30.8 and Rs40.9 respectively.
We continue to value the company on 6 times EV/EBITDA for FY09E which also captures the value of high cash and cash equivalents estimated at the end of FY09E.
We retain our BUY recommendation with realigned new target price of Rs300, for an investment perspective of nine months.