markettrend766
13-10-2008, 05:30 AM
Motilal puts buy on TCS
Brokers’ byte
Company: TCS Ltd.
Broking House: Motilal Oswal
Current Price: Rs 523.00
TCS has announced the acquisition of Citi’s 96 per cent stake in Citigroup Global Services (CGSL) the India based captive BPO arm, for an all cash consideration of $505m. The deal can make TCS a strategic vendor for Citi. This will enable additional volumes from Citigroup as well as from any acquired company in case of a vendor consolidation exercise. It also makes TCS the second largest player in the BPO segment. With steady revenue stream of $263m per annum from CGSL and with TCS leveraging CGSL service lines with its existing customers, there appears to be scope for marginal expansion in the medium term. The broking house believes that the deal offers TCS revenue visibility and has maintained a “buy” on the stock.
Company: Elecon Engineering Ltd
Broking House: Emkay
Current Price: Rs 54.50.00
Lack of strategic direction and affirmative action as regards the company’s new business initiatives into the windmill and windmill gearbox could impact the profitability of Elecon Engineering in the long run, if corrective measures are not taken by the management immediately. However, the broking firm has maintained its positive outlook on EEL’s core business of material handling equipment and transmission equipment amidst enabling environment and Rs1,770- crore strong order backlog. It has added that direct participation in the company through preferential placement is required to further strengthen investor confidence, boost sentiments and provide equity capital to fund expansion. The broking house has put “accumulate” rating.
Company: Suzlon Energy Ltd
Broking House: Edelweiss
Current Price: Rs 93.65
Suzlon is currently grappling with issues like blade crack, high leverage, slower order book accretion, and equity dilution overhang. However, the recent certification of its S88 model versions V2 and V3 will add credibility to its product portfolio. Moreover, the US House of Representatives passed the Economic Stabilisation Act last week, which will extend production tax credits for a year and investment tax credits for eight years. With the US market being Suzlon’s largest order book, the firm is expected to be a major beneficiary. The company’s RPower order book too already contains binding orders worth more than euro 1.6-billion as well as almost euro 5-billion from frame contracts. On the basis of the recent stock price corrections, the broking house has put a “buy” rating.
Brokers’ byte
Company: TCS Ltd.
Broking House: Motilal Oswal
Current Price: Rs 523.00
TCS has announced the acquisition of Citi’s 96 per cent stake in Citigroup Global Services (CGSL) the India based captive BPO arm, for an all cash consideration of $505m. The deal can make TCS a strategic vendor for Citi. This will enable additional volumes from Citigroup as well as from any acquired company in case of a vendor consolidation exercise. It also makes TCS the second largest player in the BPO segment. With steady revenue stream of $263m per annum from CGSL and with TCS leveraging CGSL service lines with its existing customers, there appears to be scope for marginal expansion in the medium term. The broking house believes that the deal offers TCS revenue visibility and has maintained a “buy” on the stock.
Company: Elecon Engineering Ltd
Broking House: Emkay
Current Price: Rs 54.50.00
Lack of strategic direction and affirmative action as regards the company’s new business initiatives into the windmill and windmill gearbox could impact the profitability of Elecon Engineering in the long run, if corrective measures are not taken by the management immediately. However, the broking firm has maintained its positive outlook on EEL’s core business of material handling equipment and transmission equipment amidst enabling environment and Rs1,770- crore strong order backlog. It has added that direct participation in the company through preferential placement is required to further strengthen investor confidence, boost sentiments and provide equity capital to fund expansion. The broking house has put “accumulate” rating.
Company: Suzlon Energy Ltd
Broking House: Edelweiss
Current Price: Rs 93.65
Suzlon is currently grappling with issues like blade crack, high leverage, slower order book accretion, and equity dilution overhang. However, the recent certification of its S88 model versions V2 and V3 will add credibility to its product portfolio. Moreover, the US House of Representatives passed the Economic Stabilisation Act last week, which will extend production tax credits for a year and investment tax credits for eight years. With the US market being Suzlon’s largest order book, the firm is expected to be a major beneficiary. The company’s RPower order book too already contains binding orders worth more than euro 1.6-billion as well as almost euro 5-billion from frame contracts. On the basis of the recent stock price corrections, the broking house has put a “buy” rating.