Stock Update – Corporate Action
Cummins India - Accumulate Adjusted Price 439 Adjusted Target 621
Cummins India Ltd had announced on 12th Sep, 20011 that 21 Sep, 2011 has been fixed as Record Date for the purpose of issue of fully paid Bonus Equity Shares in the ratio of 2:5.
We maintain our positive view and recommend to Accumulate for 18-24 months. Stock is now quoting at Ex-Bonus hence our adjusted target price is 621.
Recommend Price (Cum-Bonus) = 614 Rs.
Adjusted Reco. Price (Ex - Bonus) = 614* 5/ 7= 439 Rs.
Therefore
Original Target Price ( Cum – Bonus) = 870 Rs.
Adjusted Target Price ( Ex-Bonus ) = 870*5/7 =621 Rs.
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