Indian Equity Research and Investment Strategy
Morgan Stanley [MS] just a while ago has downgraded Tata Consultancy Services to Equal-Weight. While Credit Suisse already maintains a Neutral rating on the same.
Lower profitability of large deals and slower than expected ramp-ups could affect profitability over the coming quarter, in MS’s view. (more…)
Jaiprakash Associates [JA] is a play on India’s Infrastructure sector. JA derives its value from combination of Construction and Development. Kotak sec has initiated coverage on JP Associates with a BUY recommendation.
JA will emerge as a leading developer of Real Estate and Power generation. The company has the expertise to bag mega projects. JA has the right to develop 6,250 acres of land on the Taj Expressway corridor. (more…)
Tata Chemicals:TCL’s fertilizer business, which comprises urea (32% of fertilizer revenues) and complex fertilizers (68%), should benefit from favourable policy pronouncements. The latest $1 bn acquisition of a 100% stake in GCIP at 2.4x EV/Sales and 7.6x EV/Ebitda is definitely much more competitive than its earlier acquisition of Brunner Mond at similar valuations. Spot prices of Phosphoric acid are hovering around $1400/Mt against IMACID’s contracted price of $566/Mt, which are due for renewal later this month. The profits for IMACID to rise by 30% & 22% in FY09E and FY10E mainly led by firm prices and increase in capacity from 0.36 Mtpa to 0.45 Mtpa. Led by firm soda ash prices and repaying of high cost debt, we expect adjusted profits for BMGL to rise by 57% and 35% in FY09E and FY10E. (more…)
Deepak Fertalizer”DFPCL is setting up a 0.3 mtpa Greenfield nitric acid and ammonium nitrate plant in Paradeep, Orissa at a capex of about Rs 5 bn. The company intends to divest 49% stake in this project to YARA International, a global major in fertilizers.DFPCL has its gas supply met from ONGC’s Mumbai Offshore; however, due to a problem at their end, the gas supplies fell in FY08E. We expect the situation to turn into normalcy and DFPCL to get higher volumes of gas from ONGC. (more…)
Dabur Pharma has announced that the Burman family, promoters of the Dabur Group has decided to divest its entire stake in Dabur Pharma to Fresenius Kabi, a business segment of Fresenius SE, at a price of Rs 76.50 per share.
Dabur Pharma is the pharmaceutical business of the group and is focused on the attractive global ocology market. It has built up an impressive product portfolio in ocology which is being sold through its global footprint across more than 40 countries including the key markets of US and Europe. Fresenius Kabi is a business segment of the healthcare group Fresenius SE.
Wipro’s results for Q4FY08 were in line with expectations. Global IT services & products revenues grew 6% in INR terms. This was mostly volume-led.EBIDTA margins in the global IT business were lower predominantly due to on-site salary hikes. The management has re-iterated continuing traction with marginal impact of the US sub-prime issue, as yet. This indicates flat to marginally higher client budgets but increasing traction and preference for offshoring. (more…)