Capita Telepholio BUY Recommendation Updated for You

BUY      : Hydro S&S Industries at Rs 33
BSE Code     : 524019
NSE Symbol : Not listed
Market Lot    : 1

Hydro S&S Industries is a leading manufacturer of re-inforced polypropylene compounds, thermoplastic elastomers and fibre-reinforced composites. Due to increasing use of its products, introduction of new products with strategic foreign tie-ups as well as general growth in automobile and consumer durable industries, the company is on a high growth path. Expected fall in petrochemical raw material prices subsequent to fall in crude oil prices and introduction of VAT in Tamilnadu are likely to boost profit margins going forward.

Actual adjusted EPS for March 2005 :  Rs 0.6
Actual  adjusted EPS for March  2006 :  Rs 1.6
Projected adjusted EPS for March 2007 :  Rs 5.0 

 

Banking Stock - Quick Gain of 15% on cards on Technical Analysis

One of the first private banking entities in the country, UTI Bank was promoted by the erstwhile UTI, LIC and GIC. Breaking away from its corporate focus, the bank has tried to tap the retail domain by the use of ATMs. The growing retail franchise of the bank would help it grow its assets at a compounded annual growth rate (CAGR) of 30% and expand its net interest margin (NIM). UTI Bank has emerged as the country's third largest private bank, thanks to the Management's focus on building a technology-enabled national footprint and a large retail franchise. Improving profitability, reducing bad loans and prospects of a strong earnings growth will drive the stock's valuations over the coming months. The stock has broken out of a bullish pattern and is headed for higher levels. BUY.

Anand Rathi's Quick Pick for 20% near term profit and 45% mid term gains

The stock has recently crossed the previous peak of Rs 147, [formed in mid May'06] with huge volumes, indicating a perfect breakout. Then it touched a high of Rs 164 and now after retesting the breakout bottom of 147- 148; is looking again poised to cross the recent peak of Rs 164 and likely to touch 190 in near term [2-3 months] and Rs 225 in medium term [5-6 months]. Buy with stop loss of Rs 140.

ABC Bearing is a leading supplier of cylindrical roller and taper roller bearings to tractor, commercial vehicles and car makers and is  one of the big players in India in Tapered Roller Bearing segment. ABCB has a technical alliance with NSK, Japan and is certified for QS-9000 by TUV-Germany. Tata Motors, M&M and Toyota Kirloskar are amongst the major clients of ABCB. ABCB was able to clockin a revenue growth of around 18% in FY06, despite the fact that the main segment of the company (Medium and Heavy Commercial Vehicles) showed a flattish growth in demand. The increase was mainly supported by the LCV and the tractor segment where the demand grew by 24% and 13% respectively. The company was facing labour issues in its Lonavala unit, which have now been settled and the machinery has been shifted to Bharuch, Gujarat. This will help in increasing the capacity utilization for ABCB, thus boosting the topline. The soft oil price regime augurs well for the Auto sector which inturn will lead to an increased demand for ABCBs prodcuts. Softer metal prices mainly steel which is a key raw material for ABCB is also positive going forward. Looking at the demand growth from the auto sector, ABCB is planning for capacity expansion, which would be financed through a mix of debt and internal accruals. Further the Lonaval plant land could fetch the company around 70 - 80 crs, which could be used by the management for expansion purpose or to retire the debts. The stock is currently trading at a PE of 6.50x of FY07E (Earnings are calculated pre-VRS provision ). At the current PE, its quite cheaper compared to peers like SKF India, FAG India, NRB Bearings. Looking at the strong and sustained demand growth from the Auto industry we recommend a BUY for this stock.

Tata Power may gain on outlining major investment plans in Orissa

Tata Power may gain on outlining major investment plans in Orissa. Tata Power Company said on Tuesday it will invest Rs 9,000 crore in setting up two coal-fired power plants, with a capacity of 1,000 Megawatt each, in Orissa. The company has signed an initial agreement with the state government, and will also set up captive coal mining facilities near the projects.

As per the agreement, Tata Power will sell power from the two projects to neighbouring states, and will also cater to Tata Steel's proposed steel plant in Orissa.

Last week, the Orissa Government cleared 11 thermal power projects with a total capacity of 15,920 Megawatts, and entailing an investment of about Rs 62,500 crore. Other power producers such as Reliance Energy, CESC, and Sterlite Energy are also planning projects in the state. Reliance Energy mulls a 4,000 Megawatt thermal power plant in Jharsuguda district at a cost of Rs 16,236 crore, while CESC plans a 1,000 Megawatt plant for Rs 4,042 crore. Sterlite Energy will set up a 2,400 Megawatt plant.

The board of Sonata Software at a meeting held on 26 September 2006, considered a proposal for investment in an overseas cpmpany and has authorized B Ramaswamy, President & Managing Director, to negotiate the final terms and execute a memorandum of understanding, the company said in a statement.

ICSA India has signed an agreement with Oil India to market and undertake projects in India, and abroad for pipeline Intelligent Cathodic Protection (ICAP) and related projects.

GMR Infrastructure has announced that the "Adloor Yellareddy — Pochanpalli" road project on NH-7 in Andhra Pradesh, being executed by a subsidiary, GMR Pochanpalli Expressways, has achieved financial closure.

HOV Services makes its debut on BSE and NSE today. The BSE scrip code of the company is 532761. The company had priced its IPO at Rs 200 per share.

Source: Capitalmarket

BPO firm HOV Services was trading at Rs 191 on BSE, a discount over the IPO price of Rs 200.

HOV Services falls below IPO price. BPO firm HOV Services was trading at Rs 191 on BSE, a discount over the IPO price of Rs 200.

The stock hit a low of Rs 188.15 and a high of Rs 208.80. As many as 4 lakh shares changed hands in the counter on BSE.

The company had priced its IPO at the lower end of the Rs 200 to Rs 240 price band. Even at the lower end, the pricing for the IPO was stiff.

The current price of Rs 191 discounts its FY 2006 (year ended 31 March 2006) EPS of Rs 9.20, based on consolidated financial, by a PE multiple of 20.7. The post-issue equity capital of the company is Rs 12.55 crore. Face value is Rs 10 per share.

HOV Services provides business process outsourcing (BPO) services in the finance and accounting business sector with operations in India and the US. The company services US-based corporate clients through three main operating business divisions: Accounts Receivable Management (ARM), Enterprise Management Tools and Services (EMTS) and Insurance and Tax Services (ITS). The clients are companies in the healthcare, telecommunications, banking and finance and insurance industries.

HOV has a premier customer base that includes large companies with a healthy demand for services in the telecommunications, health care, financial services and insurance sectors. In addition, the company has been largely successful in maintaining the existing customer base. A large percentage of the revenue of HVL comes from a limited number of clients.

HOV will use the funds of the current issue for planned capital expenditure of Rs 21.08 crore, to set up a new facility in Pune to house 750 seats in three phases by 31 March 2007, 140 seats at the existing Pune headquarters and 110 seats at the Dallas facility in Phase I with further expansion in Phase II and III.

On a consolidated basis, HOV Services reported a net profit of Rs 11.59 crore on sales of Rs 163.84 crore for FY 2006.

Source: Capitalmarket