Strong revenue and earning growth

[finizard]

Strong revenue and earning growth
We expect OPTO CIRCUITS INDIA LTD to register a strong 56.7% and 43.7% compounded growth in
revenues and earnings, respectively over the next two years. For FY09, we expect
revenue growth of 73.9% to Rs.8.1bn and net profit growth of 43.5% to
Rs.1.9bn.
We expect 43% and 44% growth in EPS in FY09 and FY10,
respectively.
Strong global distribution network:
OCIL has strong global distribution network through its subsidiaries. While AMDL
takes care of domestic marketing, Mediaid Inc. has worldwide distribution network
with major presence is in the US markets. EuroCor (its German arm) has a presence
in almost 35 countries through its dedicated distributors. We believe this helps
company to sell its products globally in most efficient manner. In FY08, OCIL
generated 89% of sales from international markets. Currently, the company has
more than 200 distributors worldwide and strength of 80 people in sales and
marketing.
We maintain BUY recommendation with target price of Rs.463 over a period of
6-9 months time horizon;