UBS cuts Cairn India target price

UBS has cut target price of Cairn India to Rs 385 from Rs 425 on assumption of higher royalty payments after its parent Cairn Plc and Vedanta agreed to remove the non-compete clause fee of Rs 50,decreasing its selling price. “We believe the sharp fall in Cairn India’s stock price is a good buying opportunity as the risks seem overdone,” However UBS has reiterated its ‘buy’ rating and lowered its FY12-13 earnings by 6.9-2.8 per cent. “If royalty is split in proportion across both partners,then all parties-Government,Cairn and ONGC-have an incentive to produce more,” At 11.16 a.m. shares in the company were trading at Rs 308.70,up 1.05 per cent