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ITC gains as Q3 outcome lives up to estimates
Wednesday, January 31, 2007

The stock had bounced back from a lower level ahead of results. From Rs 162.65 on 9 January 2007, the scrip recovered to Rs 172.40 by 29 January 2007. The stock had earlier drifted lower in a weak market. From Rs 177.65 on 28 December 2006, ITC declined to Rs 162.65 on 9 January 2007.

The key trigger for the ITC scrip, in the near term, is developments pertaining to value added tax (VAT) on cigarettes. The Centre has agreed to allow states to levy VAT on tobacco and tobacco products. The Centre and states reached an agreement in early January 2007, to phase out central sales tax (CST) over the next four years.

A 12.5% VAT on cigarettes will lead to a steep hike in cigarette prices, which may impact volumes. The concern for the cigarette industry is higher taxes may result in a shift in tobacco consumption, to low-end products such as bidis and chewing tobacco.

ITC today reported a 33.6% growth in net profit in the December 2006 quarter to Rs 717.40 crore, from Rs 536.83 crore during the year ago period. The net profit was at the top end of analysts' expectations. Net sales rose 23.8% to Rs 3165.57 crore (Rs 2556.04 crore), which was also in line with estimates.

ITC has initiated retail and wholesale vending of vegetables and fruits. The company has prepared a plan to expand its 'Choupal Fresh' stores across the country. The company will open 140 stores across 54 towns in the next three - four years. Currently, ITC runs a store each in Chandigarh, Pune and Hyderabad.

Published by DalalStreet Business @ 1:17 PM  



India Real Estate Investment
Tuesday, January 30, 2007

If you are planning for Real Estate Investment in 2007, then here is an in depth review of prevailing property prices across various cities in India.
Delhi and NCR is also one of the hottest property market but the prices have risen way too sharp, so don't expect much returns unless you are first time home buyer.

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Published by DalalStreet Business @ 1:24 PM  



Bonus bounty powers Bhel's upmove
Monday, January 29, 2007

As many as 48,353 shares changed hands in the counter on BSE.Rumours of a bonus, stock-split boosted the stock ahead of the results announcement. From Rs 2315.80 on 23 January 2007, the stock rose 5.7% in just two trading sessions to Rs 2448.35 on 25 January. The announcement of a bonus hit the market after trading hours on 25 January.

At the time of declaring Q3 results, Bhel also unveiled a 1:1 bonus issue on Thursday (25 January). Bhel reported 58% growth in net profit in December 2006 quarter to Rs 667.70 crore, on 32% growth in sales to Rs 4339.70 crore.

The order backlog at end of Dec 2006 was Rs 46700 crore, a rise of 38% on year-on-year. The current price of Rs 2500 discounts its FY 2006 (year ended 31 March 2006) EPS of Rs 68.60, by a PE multiple of 36.4.

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Published by DalalStreet Business @ 10:19 PM  



Buy Cadila HealthCare - ASK Raymond James
Friday, January 26, 2007

ASK Raymond James has maintained its BUY recommendation on Cadila Healthcare Ltd with a price target of Rs 450.

Cadila Healthcare posted 15% YoY growth in consolidated profits (adjusted) at Rs426 mn in 3Q FY07, lower than its expectation of Rs519 mn. Profits have been primarily impacted by 85% YoY increase in R&D cost at Rs294 mn, higher A&P spent on consumer healthcare business and lower sales in Altana JV. A 25% YoY growth in consolidated sales is primarily driven by US and French generics markets, which grew 147% at Rs928 mn (20% of sales).

The management indicated 20% growth over the next few years driven by generics markets and pick up in APIs. The stock trades at 20.0x FY07E earnings and 15.2x FY08E earnings and trades at 14.4x FY07E EV/EBITDA and 11.3x FY08E EV/EBITDA. ASKRJ, maintain Buy rating on the stock with a target price of Rs450 (14x FY08E EV/EBITDA).

Sales and EPS expectations for FY2008 are - Rs 2140 crore and Rs 23.6 respectively.

Published by DalalStreet Business @ 7:00 PM  



Bharti Airtel upbeat after Q3 results
Tuesday, January 23, 2007

The stock also hit a life high of Rs 700.80. As many as 1.9 lakh shares changed hands in the counter on BSE.

The stock had firmed up in the run up to the results. From Rs 613.10 on 10 January 2007, it surged to lifetime closing high of Rs 682.05 on 19 January 2007, only to ease the next day to Rs 676.35.

Bharti Airtel’s consolidated net profit as per US GAAP, jumped 122.8% to Rs 1215.13 crore (Rs 545.30 crore), beating market expectations. Four brokerages had forecast 87.6% to 99.2% growth in Bharti’s net profit.


Consolidated revenue rose 62.3% to Rs 4913 crore (Rs 3025.60 crore). Topline growth was within analysts’ expectations.

The board of Bharti Airtel today approved transfer of its towers for mobile communications and related infrastructure, to a wholly-owned subsidiary, Bharti Infratel, for better operational efficiency.

The company also announced commencement of Direct-To-Home (DTH) services to address the fast-growing home entertainment segment through Bharti Telemedia, another wholly-owned subsidiary.

The board also approved acquisition of a submarine network cable system from Network i2i (jointly owned by Singtel and a Bharti group company) for an overall consideration of $ 110 million.

Published by DalalStreet Business @ 3:34 PM  



BUY HCL Technologies - ASK Raymond James
Friday, January 19, 2007

ASK Raymond James has upgradded HCL Technologies Ltd to BUY with a 12 month price target of Rs 740 from current levels of Rs 640.

After reviewing Q3 results, ASK analysts believe that HCL Tech is one of the cheapest stocks in the large-cap universe.

Strong volume growth: Revenue growth was driven by a strong growth in volumes of 7.1% sequentially and improved price realization (+1.3%) in core software services (IT & Infrastructure). Infrastructure services (+11.8% QoQ), Engineering services (+7.1% QoQ), BFSI (+26.7% QoQ) and Life Sciences, though on a smaller base, (+21.4% QoQ) surpassed the company growth rates.

Margins increase by 47 bps: Margins increased by 47 bps to 22.1% mainly due to higher utilization (+120 bps) and improved price realization (+140 bps). This was offset to a certain extent by rupee appreciation (-150 bps) and increased SG&A (-90 bps) as there was a customer summit held during the quarter. The management noted that the large deals, in contrary to the belief are proving to be margin accretive for them.

Maintain Buy at a price target of Rs 740: In view of the quarterly results, we have revised our FY07E earnings marginally to Rs32.6 (+1.4%). However, we are maintaining our FY08E earnings at Rs39.1.

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Published by DalalStreet Business @ 1:29 AM  



Macquaire bearish on Cairn India
Thursday, January 18, 2007

Macquaire in its latest research report is bearish on the prospects of Cairn India and has set a 12 month stock price target of Rs 130, a potnetial for Cairn India to slide 10% from current levels of Rs 145. Macquaire has arrived at Rs 130 based on the sum of parts valuation model.

Cairn India recently completed its IPO at a price of Rs 160 / share. We had asked the readers of DalaStreet.Biz not to subscribe to Cairn India IPO. It is a good BUY around Rs 100 but only for the long term investor.

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Published by DalalStreet Business @ 2:19 AM  



Infosys Q3 results no surprises
Thursday, January 11, 2007

Infosys Technologies Ltd has announced its results for the quarter ending Dec-31st, 2006. The results have no surprises and are mostly in-line with expectations. Most brokerage houses were expecting a Q3 net profit of Rs 982 crores except Karvy which was expecting 993 crores and Infy has reported 982 crores.

Infosys full year FY 2007 guidance:

* Revenues: Rs 13853 - Rs 13899 crore
* Growth: 45.5 - 45.98%
* Net Profit: Rs 3602.7 crore
* EPS: Rs 66
* Growth: 46.56%

Infosys stock is down 1.5% and is currently trading at Rs 2130 on the NSE.

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Published by DalalStreet Business @ 9:47 AM  



India Investment Strategies for 2007
Sunday, January 07, 2007

Here are some Investment Strategies for 2007 in Indian Stock Market.

Download - CLSA Investment Ideas for 2007. [PDF]

Also the performance and expectations from Indian Inc for Q3 [PDF] as reported by ASK Raymond James is here.

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Published by DalalStreet Business @ 12:34 AM  



Two way authentication by Reliance Money ?
Saturday, January 06, 2007

Reliance Money, the retail stock broking arm of Anil Ambani group is planning for a two way authentication process of its customers to login to the portal.

What is two way authentication ?
1. Normal Login & Password.
2. Additionally, Reliance Money will provide a device which will generate a password and that has to be keyed into the login page within 20 seconds. You have to carry this device always with you.

Now, wait a minute why do we require such 2 way authentication mechanism ? Aren't other broking houses providing services without it ? Such high security systems are usually implemented by corporates who have access to highly confidential and sensitive data.

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Published by DalalStreet Business @ 5:48 PM