Archive for the ‘K R Choksey’ Category
Infosys Technologies Ltd - KRC Stock Recommendation
Infosys Technologies Ltd
Result Update: Q4 FY08
Key Data
CMP Rs 1750.75
Date April 29th 2008
Sector Software
Face Value Rs.5
BSE Code 500209
52 Week H/L Rs 2415/ 1517
Market Cap Rs 95235 Cr
Investment Rationale
Infosys is the leading Software Company in India and is held in high esteem by clients and competitors alike. The company witnessed growth of 6.3% q-o-q and 20.4% y-o-y in top line to Rs 4542 crore. The net profit declined by 5.1% q-o-q and 2.1% y-o-y to Rs 1168 crore, while the EBIDTA margins declined by 80 bps at 32.5% in Q3 FY08. The company is witnessing strong sequential growth in Maintenance, Package Implementation, Testing and BPO services. While in terms of verticals it is witnessing strong growth in BFSI, Retail and Services sectors. Though the company’s growth slowed down in Q3 FY08 vis-à-vis its robust growth in Q2 and Q3 of FY08 quarters, it has exceeded guidance. The company’s books reflect healthy financial performance with cash and cash equivalents of Rs 6950 crore as on date. Also it has superior compelling value proposition to offer to its clients and higher EBIDTA margins compared to its peers. Thus the company still has strong potential for growth in future and based on the strong expected earnings in the next year, we recommend a buy on the stock with a long term view.
Key Developments
Billing rates remain stable
Despite current trends which have lead some operators to decline pricing or maintain current levels, Infosys has been able to record a marginal increase of 0.24%y-o-y in billing rates during Q4FY08 and 5.6% y-o-y. Offshore billing rates have increased 0.53% y-o-y while volumes on the top 10 clients grew 12% y-o-y. This trend was supported by the company’s policy to be selective in accepting contracts, maintaining revenue productivity and deep client relationships. Given the flat trend in Q4FY08, and the current US economic environment the company has guided towards stable pricing trends in FY09.
Employee additions to decline while utilization rates improve
Infosys plans to hire about 25,000 candidates in FY09, which are about 8,000 less than FY08 levels as the company expects the first two quarters of this year to go slow. Of the 25,000-strong recruitment planned, 18,000 campus offers have been made. Typically, 70- 75% of these offers are converted into recruitment. In Q4FY08, the company added 2,586 employees and recorded a decline in attrition to 3.8% compared to 4.0% in Q4FY07. This contributed to a decline in utilization Q4FY08, and is expected to improve in Q1FY09 to 76.5%
Financials
Net sales up 6.3% q-o-q
Infosys delivered revenue growth of 6.3% q-o-q to Rs 4,542 crore, supported by enterprise services and package implementation services expansion. EBITDA margin remained flat at 32.5% q-o-q. Net profit declined 5.1% q-o-q to Rs 1,168 crore (excluding tax reversal of Rs 200 mn). Net income was impacted by forex losses of Rs 450 mn (versus Rs 140 mn in Q3FY08). As a result, EPS for Q4FY08 declined 5.2% q-o-q to Rs 20.43 from Rs 21.55.
Valuations
At the CMP of Rs 1750.75, Infosys is quoting at a PER of 21.85. On EV/Sales and on EV/ EBIDTA basis it is quoting at 5.46x and 17.38x respectively based on consolidated twelve months earnings ending as on Mar’08.
Click Here for In-depth Infosys Technologies Ltd research report by KR Choksey, company profile along with stock recommendations, Infosys Technologies Ltd target price and for making informed investment decisions.
Kisan Ratilal Choksey Shares and Securities Pvt. Ltd.
1102, Stock Exchange Tower, Dalal Street, Mumbai 400 001
Phone: 91-22-56338050 / 66965555. Fax: 5633 8060
Members: BSE & NSE
www.krchoksey.com
Email: customercare@krchoksey.com / eservices@krchoksey.com
29th April 2008 KRC Market Commentary
Click here to read 29th April, 2008 KR Choksey Stock Market Update up to 2.30pm.
Result Update: Reliance Capital FY08 consolidated net profit at Rs 10.09 bn. Dividend declared Rs 5.50/Share
News Update:
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Tata Power refinances bridge loan for Indonesian coal mine buy
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Tata Steel’s Jharkhand expansion still on drawing board
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GSK Pharma to launch patented anti-cancer drug Pykerb in May
-
Warburg Pincus to invest $75 mn in Rajasthan real estate co
-
Mahindra Lifespace, Arch Capital to develop 54-acre township
FII activity for 28/04/08: Net Buyers of Rs 214.86 Crs. in Index Futures, Net Buyers of Rs 137.14 crs in Index Options, Net Buyers of Rs 24.42 Crs. in Stock Futures and Net Buyers of Rs 78.72 Crs in Stock Options.
Opening Market Review: Markets are likely to be neutral to negative in 1st half and likely to recover in 2nd half. Nifty (market) is strong above weak below: 5105; Sensex: 17089; Nifty Rest: 5132-5174; Supt: 5063-5037; Sensex Rest: 17199-17381; Supt: 16906-16796. Buying (Trading) opportunities exist in Nagarjuna Const, Bombay Dyeing, Axis Bank, Bata, BEML, Century Tex, Dr Reddy, REL. Cash buying in BEL, GTL, Thermax, Sun Pharma, Zee Ent, DLF, Unitech. Nifty April Fut. strong above/weak below: 5117; Rest: 5150-5183; Support: 5084-5051.
Kisan Ratilal Choksey Shares and Securities Pvt. Ltd.
1102, Stock Exchange Tower, Dalal Street, Mumbai 400 001
Phone: 91-22-56338050 / 66965555. Fax: 5633 8060
Members: BSE & NSE
www.krchoksey.com
Email: customercare@krchoksey.com / eservices@krchoksey.com
YES BANK - KRC Stock Recommendation
YES BANK
INITIATING COVERAGE
Key Data
CMP Rs 169
Date April 25th 2008
Sector Banking
Face Value Rs.10
BSE Code 532648
52 Week H/L Rs 278/ 120
Market Cap Rs 5012 Cr
Investment Rationale
YES BANK is a private Indian bank promoted by Rana Kapoor and Ashok Kapur with financial support from Rabobank Nederland, and global institutional private equity investors. YES BANK has 67 operational branches across 57 locations nationally, YES BANK has received additional licenses to open 57 new branches and 125 offsite ATMs taking the total licensed network to 117 branches and 200 Offsite ATM’s. YES BANK is steadily building corporate and institutional banking, financial markets, investment banking, corporate finance, business (SME) and transactional banking, retail banking and wealth management business lines across the country.
Net profit of the bank has shown extraordinary growth of 108percent qoq in Q3FY08 driven by controlled operating expenses and expansion in the NIM. Advances of the bank has grown by 50percent qoq and deposits by 61percent (qoq) and CASA deposits by 138.2percent (yoy) for the same period. The bank has ROA of 1.61percent ahead than other private sector banks. For the first time in the history of Yes Bank, it reported Gross NPA of 0.11percent and Net NPAs of 0.09percent.
25th April 2008 KRC Post Market Analysis
Market Commentary
|
|
No. of Scrips |
Value (Crs.) |
|
Advances |
522 |
11194 |
|
Declines |
619 |
2946 |
|
Unchanged |
79 |
11 |
|
Total |
1220 |
14151 |
Market Activity: Share indices were up nearly 1% mirroring gains in US and most Asian markets, but trade was choppy ahead of inflation data due at noon.
At 10.10AM, Sensex was at 16838.01, up 116.93 points or 0.7%. Nifty was at 5042.90, up 44.80 points or 0.9%.
Hero Honda Motors, up over 4%, was the top Nifty gainer on above estimated Jan-Mar net profit. Bharti Airtel was up 3% post its Jan-Mar earnings. Cairn India, down 2%, was the worst hit on Nifty, while ACC extended decline to fall another 1% following disappointing Jan-Mar earnings Thursday.
In the mid trading session, indices remained firm up over 1%, after inflation for the week to Apr 12 stood at 7.33%, largely in line with market expectations. Inflation data for the previous week was 7.14% Sensex was at 16881.88, up 160.80 points or 1%. Nifty was at 5053.75, up 53.90 points, or 1.1%. Bank shares gained as worries the RBI would resort to more measures apart from the 50-basis-point cash reserve ratio hike last week to contain inflation eased following the data. HDFC Bank and State Bank of India were up 2% each. Bharti Airtel, up nearly 7%, was the top Nifty gainer, while DLF, down 2%, was the worst hit on Nifty.
Share indices closed up over 2% at the start of the May futures series, with Sensex closing just two points shy of the 17100-mark, and Nifty ending above 5100 led by gains in Bharti Airtel, SBI, and Tata Steel. Sensex closed at 17125.98, up 404.90 points. Nifty ended at 5111.70, up 111.85 points. Bharti Airtel surged 9% on robust Jan-Mar earnings. SBI was up 4% and Tata Steel over 3%. Tata Power and ACC fell around 2% each, and were the worst hit on Nifty.
JINDAL SAW LTD - KRC Stock Recommendation
JINDAL SAW LTD
UPDATE: Q3FY08
Key Data
CMP Rs 652
Date April 24th 2008
Sector Metals – Steel
Face Value Rs.10
BSE Code 500378
52 Week H/L Rs 1224/ 517
Market Cap Rs 3334 Cr
Investment Rationale
The Q308 results were beyond market expectations. Net Sales was up by 35percent and profit after tax was up by 83percent. EBIDTA was up by 46percent. The key driver for the robust performance was because of higher sales volume and better cost management. Company booked a profit of Rs463.78crore by selling its stake of a US subsidiary company. The Company is also venturing into new businesses and diversifying its portfolio.
KEY DEVELOPMENTS
Sales and Net Profit grew by 35percent and 83percent respectively
The company posted a growth of 35percent in Net Sales to Rs.1611Crore during the quarter from Rs1192crore in Q3FY07. Net Profit grew by a whooping 83 percent to Rs110Crore during the quarter from Rs.60Crore in Q3FY07.Net profit was high because of higher sales volume and better cost management
Strong Order Book
Jindal Saw recently bagged an order of more than 200mnUSD from Cairn India for supply of line pipes, tracer tube, insulation and bends for Barmer Salaya Pipe Line (BSPL) project of Cairn. With this order, the total order book of JSL exceeds US$ 1 billion). These orders are scheduled to be executed by January, 2009.
FINANCIAL PERFORMANCE
The company declared robust results in Q3FY08 as its net profit increased by 83 percent to Rs110crore from Rs60crore in corresponding Q3FY07, Also the net sales of the company increased by 35percent to Rs.1611Crore from Rs1192crore in Q3FY07.
VALUATIONS
At the CMP of Rs.652 Jindal Saw is quoting at P/E of 9.13x TTM December 07 earnings and 1.78x its book value. The company is expected to grow on account of capacity expansion, higher pipes demand and better operating efficiency.
Click Here for In-depth JINDAL SAW LTD research report by KR Choksey, company profile along with stock recommendations, JINDAL SAW LTD target price and for making informed investment decisions.
Kisan Ratilal Choksey Shares and Securities Pvt. Ltd.
1102, Stock Exchange Tower, Dalal Street, Mumbai 400 001
Phone: 91-22-56338050 / 66965555. Fax: 5633 8060
Members: BSE & NSE
www.krchoksey.com
Email: customercare@krchoksey.com / eservices@krchoksey.com
24th April 2008 KRC Post Market Analysis
Market Commentary
|
|
No. of Scrips |
Value (Crs.) |
|
Advances |
444 |
7886 |
|
Declines |
758 |
8462 |
|
Unchanged |
38 |
60 |
|
Total |
1240 |
16408 |
Market Activity: Share indices were up around 0.5% but off the 1% high hit at open. Trade was choppy on expiry of April futures contract. Firm overnight close in the U.S. market helped sentiment, but key Asian markets were trading off highs today.
At 10.10AM, Sensex was at 16785.80, up 87.76 points or 0.5%. Nifty was at 5048.75, up 24.60 points or 0.5%.
SAIL was up 2% on value buying after falling 6% in the previous session. Telecom shares were top gainers on Nifty. Bharti Airtel and Idea Cellular rose 2% each. Housing Development Finance Corp, up 2%, was the other major gainer. Hindalco Industries and Tata Steel fell 1% each, and were the worst hit on Nifty. ACC was also down 1% ahead of its Jan-Mar earnings.
In the mid trading session, indices were trading off highs, with Nifty erasing gains, weighed down by weakness in European markets. At 1.59PM, Sensex was at 16718.05, up 20.01 points, or 0.1%, after briefly slipping into red. Nifty was at 5013.80, down 8.90 points, or 0.2%. Most bank shares were up, with HDFC Bank rising 1% ahead of its Jan-Mar earnings due later today. Tata Power, up nearly 3%, was the top Nifty gainer. Maruti Suzuki India, down 3%, was the worst hit on Nifty, after its Jan-Mar net profit fell much below estimates. ACC shares were down 2%, after moving slightly off lows, as it announced a Jan-Mar net profit of Rs 3.57 bn, above analysts’ estimates of Rs 3.06 bn.
Nifty ended below the 5000-mark for the first time in four sessions, down 0.5%. Sensex closed flat. The session was volatile on expiry of April futures. Sensex was at 16721.08, up 23.04 points. Nifty closed at 4999.85, down 22.95 points. ACC ended down 6% after its Jan-Mar earnings, while NALCO and Sterlite Industries closed nearly 4% lower each. Hero Honda, up 4%, was the top Nifty gainer ahead of its Jan-Mar earnings. Tata Power gained nearly 3% and Infosys Technologies was up over 2%.
24th April 2008 KRC Market Updates
Click here to read 24th April, 2008 KR Choksey Stock Market Update up to 2.30pm.
Kisan Ratilal Choksey Shares and Securities Pvt. Ltd.
1102, Stock Exchange Tower, Dalal Street, Mumbai 400 001
Phone: 91-22-56338050 / 66965555. Fax: 5633 8060
Members: BSE & NSE
www.krchoksey.com
Email: customercare@krchoksey.com / eservices@krchoksey.com
24th April 2008 KRC Market Flash
News Update:
-
Aventis Pharma to export paracetamol to Australia this yr onwards
-
Parsvnath to launch 13,200 sq m housing project in Jamnagar
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Bombay Rayon arm to buy Italian co’s retail ops
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Hindustan Zinc cuts lead price by Rs 2,800/tn; zinc Rs 2,400
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Parsvnath launches housing, mall project in Jamnagar
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Gayatri Projets gets 6 orders worth Rs 967.9 mn
-
AVT Natural ends sale pact with US horticultural co
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Sterlite Tech gets Rs 2.96 bn orders from Power Grid Corp
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RIL to drill 3 new production wells in KG Basin MA field
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RIL has found oil from MA field in KG Basin’s D6 Block
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DGH OKs Reliance Ind development plan for KG Basin MA field
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BSE to exclude S Kumar Nationwide from mid-Cap, 500 indices Thu
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Unitech’s arm gets spectrum in Tamil Nadu including Chennai
-
Sun Pharma arm gets US nod to market anti-cancer drug iriontecan
FII activity for 23/04/08: Net Sellers of Rs. 276.39 Crs. in Index Futures, Net Buyers of Rs 637.35 crs in Index Options, Net Sellers of Rs 230.71 Crs. in Stock Futures and Net Buyers of Rs 5.49 Crs in Stock Options.
Opening Market Review: Markets are likely to be volatile with no clear bias. Nifty (market) is strong above weak below: 5037; Sensex: 16720; Nifty Rest: 5070-5117; Supt: 4990-4957; Sensex Rest: 16850-17001; Supt: 16568-16438. Buying (Trading) opportunities exist in AIA Eng, Birla Corp, Bombay Dyeing, Century Text, EKC, Lupin, Tata Motors, Tata Steel, GBN. Cash buying in Grasim, Hind Unilever, Jindal Saw, HCC, Hind Zinc. Nifty April Fut. strong above/weak below: 5047; Rest: 5077-5111; Support: 5013-4983.
Kisan Ratilal Choksey Shares and Securities Pvt. Ltd.
1102, Stock Exchange Tower, Dalal Street, Mumbai 400 001
Phone: 91-22-56338050 / 66965555. Fax: 5633 8060
Members: BSE & NSE
www.krchoksey.com
Email: customercare@krchoksey.com / eservices@krchoksey.com
Sona Koyo Steering System Ltd. (SKSSL)
Sona Koyo Steering System Ltd. (SKSSL)
KR Choksey Stock Recommendation
Q4FY08 Result Update
Key Data
CMP Rs 44.75
Date April 23rd 2008
Sector Auto ancillary
Face Value Rs.2
BSE Code 520057
52 Week H/L Rs 74/ 36
Market Cap Rs 431 Cr
Investment Rationale
Sona Koyo Steering System Ltd. (SKSSL) is the largest manufacturer of steering gears in India with market share of over 50 percent. The company at present has three manufacturing facilities at Chennai, Nashik and Gurgaon with combined capacity of over 1.5 million units. The company intends to double the capacity through greenfield plants at Singur, Uttaranchal and Bawal in Haryana over next 3-4 years. The company derived nearly 53 percent of revenue from Maruti Suzuki India Ltd and top 6 clients contribute nearly 90 percent of top line. The company has reported 17.8 percent growth in net sales to Rs683.60 crore in FY08 whereas the net sales for Q4FY08 registered a growth of 10 percent to Rs194.30 crore. The full year EPS of the company declined by 12.7%. This was partly on the back of rising input cost and partly due to equity dilution. However the company is expected to pass on the rise in input cost to its customers and also obtain better pricing from its vendors in the coming time.
The company has formed a (49:51) JV with JTEKT of Japan to serve the steering system requirement for small cars up 1500 CC segments. The proposed JV would be focused to the clients like Tata Motors, Toyota and Nissan etc. The company would be investing Rs160 crore for greenfield facility at Bawal in Haryana, the proposed JV is expected to contribute approx Rs320 crore in the topline from FY11 onwards.
23rd April 2008 KRC Market Update
Market Commentary
|
|
No. of Scrips |
Value (Crs.) |
|
Advances |
581 |
7000 |
|
Declines |
642 |
8095 |
|
Unchanged |
17 |
173 |
|
Total |
1240 |
15269 |
Market Activity: Indices were up around 0.3% in early trade, on the back of gains in key Asian markets that reversed losses made earlier in the session. Trade was choppy a day before expiry of April futures contract.
At 10.10AM, Sensex was at 16835.38, up 52.04 points, or 0.30%. Nifty was at 5066.70, up 17.15 points, or 0.35%.
Idea Cellular and Infosys Technologies, up nearly 3% each, were top gainers on Nifty. Unitech and Larsen & Toubro gained 2% each. Satyam Computer Services and HDFC Bank, down around 3% each, were major laggards on Nifty. SAIL fell 3% and Tata Steel was down 2% after the companies agreed to keep product prices unchanged for two-three months.
In the mid trading session, indices gave up gains to fall nearly 1% as banking, steel, and capital goods shares fell. Market was up around 0.5% earlier. At 11.30AM, Sensex was at 16664.88, down 118.99 points, or 0.7%. Nifty was at 5021.20, down 30 points, or 0.6%. SAIL, down nearly 7%, was the worst hit on Nifty, while Tata Steel fell 3% as they agreed to keep product prices unchanged for two to three months. HDFC Bank was down 4%, while ICICI Bank and Bharat Heavy Electricals fell 3% each. Real estate and technology shares bucked the weak trend. Unitech, up 3%, and Wipro, up 2%, were top Nifty gainers.
Share indices ended nearly 1% lower after a volatile session ahead of April futures contract expiry Thursday. Sensex was at 16698.04, down 85.83 points. Nifty was at 5022.80, down 26.50 points. SAIL was down 6% at Rs 173, while Idea Cellular and HDFC Bank were down around 5% each. Infosys Technologies up over 3% and Unitech up 2% were top gainers on Nifty.
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