Tuesday, April 12, 2011

Analysts' corner Bse Nse Stock

DB Corp, eClerx Services & REI Agro

Reco Price: Rs 250,
Target Price: Rs 315

DB Corp’s local advertisers’ business is growing at over 20 per cent and is expecting a similar robust growth going forward (both from same-store growth and through expansion). Proportionately, the ad spend allocation has also risen, they expect ad spend to further rise for the business. Jharkhand (JHK) market has experienced severe competition after the launch of Dainik Bhaskar. DB Corp, an eight-month-old entrant, is gaining its ground on the back of lucrative ad rates to advertisers and compelling content to readers. DB Corp’s aggressive pricing play has consistently rewarded the group. Dainik Bhaskar, within eight months of its launch, is already the largest circulated newspaper in Ranchi. Renewal of annual subscription of Ranchi edition would be a key factor to gauge for. Maintain buy.

— Pinc Research

Reco Price: Rs 685,
Target Price: Rs 740

eClerx differs from other pure BPO players as eClerx’s work involves specialised domain knowledge and judgement-based processing, which are core to the clients’s business operations. The company believes that the proposed Dodd Frank bill would provide strong volume growth opportunities as all the transactions would be cleared through one central clearing agency. Company believes that it would be able to sustain margins in the low- to mid-30s range. Company is aiming to increase its onsite sales fleet to 40-plus (versus 26 as of Dec’2010 quarter). Maintain accumulate.

— Emkay Global Financial Services

Current Price: Rs 27,
Intrinsic Value: Rs 38

CARE Equity Research assigns fundamental grade of 3 on 5 to REI Agro (RAL), indicating ‘Good Fundamentals’. The demand prospects for basmati rice is buoyant both in the domestic and international markets. Being amongst very few integrated and large producers of basmati rice, RAL is one of the most competitive players in the industry with vast distribution network and presence across various price segments. In line with the industry phenomenon, RAL has a long term operating cycle on account of its high inventory holding period. Nevertheless, the management has adopted various strategies to minimise its working capital requirements going forward.

— CARE Equity Researc        

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