Infosys Technologies Ltd has proposed exit its holding in OnMobile said a report released just a while ago by HDFC Sec. The stock at 32x FY09E earnings estimates is expensive, considering that the only comparable peer listed, Tanla solutions is at 14x FY09E earnings. (more…)
Month: February 2008
Bajaj Auto Demerger Details
The Bombay High court has approved the scheme of demerger – which splits BJAT into three entities: Bajaj Auto Limited, Bajaj Holdings and Investment Ltd and Bajaj Finserve Ltd. BJA stated in a filing with the exchange that the ‘effective date’ and ‘record date’ are yet to be fixed.
Bajaj Auto will demerge its businesses into three entities
a) Bajaj Auto Ltd. (auto businesses + Rs15bn in cash);
b) Bajaj Finserve Ltd. (windpower projects, investments in the insurance ventures, investment in Bajaj Auto Finance and Rs8bn in cash);
c) Bajaj Holdings and Investment Ltd (residual cash, investment in ICICI and 30% stake in both Bajaj Auto and Bajaj Finserve).
All current shareholders of Bajaj Auto will get 1 share each of the new businesses (for every 1 share held in Bajaj Auto).
Bharti Airtel – Downgraded to Hold
In a report released just a while ago, Deutsche Bank [DB] AG has downgraded Bharti Airtel to HOLD from buy. DB is bullish on the long-term sector growth compared to the street and believe that the sector’s period of sustained out-performance is behind us. Bharti led to an exponential growth and a large revenue base (c18bn wireless revenues in 6-7 years) – a feat unmatched by any other sector in the last five years. However, both growth and margins are likely to be impacted as operators move deeper into the rural areas in search of revenues. A look back on Hindustan Unilever’s past performance reflects a similar dynamic. (more…)
Shri Lakshmi Cotsyn – SBI Caps
SBI caps has initiated coverage on Shri Lakshmi Cotsyn Ltd [SLCL] with a BUY rating.
SLCL is a multiproduct company involved in the manufacturing of denim, terry towel, bottom weight, home furnishing, nylon and wearable apparels. SLCL is aggressively building capacity in the textile industry with a committed capex of Rs 457 crore in two phases in the last two years. SLCL has planned a CAPEX of Rs 310 crore in the current year. (more…)
Amtek Auto + Bharat Forge – Edelweiss
Edelweiss had a site visit to Bharat Forge and Amtek Auto. Here is the key takeaway after talks with the management of both the companies.
Amtek Auto:
Amtek’s Sanaswadi plant was commissioned in Q1FY08 with a machining capacity of 1 mn units, primarily for crankshafts. It also has a capacity for machining 50,000 units p.a. of front axle beams. A second shed is being made for the Amtek VCST JV that is 70% complete. Delivery of machining capacity for this JV is expected by March 2008; the JV’s trial production is likely to start by June end. (more…)
HBL Power System Limited
We have just received the results of HBL Power. Here is a quick look and analysis on the same.
For Q3FY08, it has reported Revenues of Rs.288.6 crore compared to Rs.121.9 crore in the same period last year, a 137% growth on YoY basis and 11% growth on QoQ basis. It has reported EBIDTA of Rs.51.9 crore compared to Rs.18.3 crore last year, a growth of 183%. Growth in PAT is even more impressive at 279% as its PAT stood at Rs.27.7 crore in Q3FY08 from Rs.7.3 crore in Q3FY07. EBIDTA Margin improved to 18% in Q3FY08 from 11.2% in Q2FY08 and 15.1% in Q3FY07. On QoQ basis, EBIDTA margin expanded by 680 basis points, mainly due to lower raw material (lead) prices.
In last 3-4 months, price of 2 key raw materials have fallen by more than 30-35% from its peak in October, which has resulted in improved situation on raw material as a percentage to sales.