Thursday, July 31, 2008

FABL "FAYSAL BANK" FAIR VALUE : Rs.60

FABL Current Price: Rs.26.80

FABL "FAYSAL BANK" FAIR VALUE : Rs.60


Faysal Bank (FABL) is currently trading at 48% discou(0.85x) to 2nd tier banks’ average CY08E P/Bx of 1.6x. Ttranslates into 63% TSR (including 8% dividend yield) relation to our intrinsic value of Rs 60/share. Faysal Bankexpected to post a modest 3-year CAGR of 10% in nrevenues, whereas net earnings are expected to surge arate of 13%, despite lower ROE of 9% for CY08E. Wbelieve the scrip calls for Accumulate stance at curremarket price of Rs26.8/share.

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