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Friday, November 24, 2006
Big Deals
Indian companies paid more than $10 billion to buy foreign firms this year alone. Here are some recent noteworthy acquisitions
INDIAN BUYER: MITTAL STEEL World's largest steelmaker is Europe based but Indian owned
Company acquired: ARCELOR (LUXEMBOURG) Europe's top steel producer
PRICE: $33.5 billion
DATE: June 2006
INDIAN BUYER: VIDEOCON Consumer-electronics and home-appliance manufacturer
COMPANY ACQUIRED: THOMSON (FRANCE) Manufacturer of TVs, color-TV picture tubes
PRICE: $291 million
DATE: June 2005
INDIAN BUYER: SUZLON ENERGY Alternative-energy company, wind-turbine maker
COMPANY ACQUIRED: HANSEN TRANSMISSION (BELGIUM) Manufacturer of gearboxes for wind turbines
PRICE: $565 million
DATE: March 2006
INDIAN BUYER: DR. REDDY'S India's second-largest pharmaceutical company markets generic drugs in over 100 countries
COMPANY ACQUIRED: BETAPHARM (GERMANY) Generic-drug distributor specializes in medications for heart and neurological ailments
PRICE: $572 million
DATE: February 2006
INDIAN BUYER: TATA TEA Part of the giant Tata conglomerate; owns Tetley Tea
COMPANY ACQUIRED: ENERGY BRANDS (U.S.) Maker of Glaceau bottled water and vitamin drinks
PRICE: $677 million (30% stake)
DATE: August 2006
INDIAN BUYER: ONGC-VIDESH Overseas arm of India's state-run oil company
COMPANY ACQUIRED: OMIMEX DE COLOMBIA (COLOMBIA) Owns half of two major oilfields in its home country
PRICE: $425 million (50% stake)
DATE: September 2006
Indiainfoline - From Research Desk
November 24, 2006
Bal Pharma Ltd. Visit Note
Bal Pharma Ltd. (BPL), a mid sized pharma company focused on the domestic and semi-regulated markets is jointly promoted by Mr. Ghevarchand Surana of Micro Labs Group, which has a turnover of over Rs.3bn, ranked No.20 in the Indian Pharma Industry and the Siroya family, a multi-million dollar non-resident group based in Dubai. BPL clocked revenue of Rs746mn and PAT of Rs29mn for FY06. The management aims to clock revenue of Rs3-3.5bn over the next 4-5 years. For FY07 & FY08, the management has given a revenue guidance of Rs1bn and Rs1.35bn and profitability guidance of Rs60mn and Rs110mn respectively. At Rs38, the stock is trading at 6.8x FY07E and 3.7x FY08E.
Highlights Bal Pharma focuses on branded generics and bulk drugs in the domestic and exports market. Around 60% of revenue comes from the domestic market. The company has presence in 42 countries in the export market. The company has received CoS from EDQM on gliclazide in 2005 and is looking at scaling up contract manufacturing for the EU market. Gliclazide clocked revenue of Rs108mn in FY06. The current capacity is 3T/ mth expected to be ramped up to 12T/mth over the next few years.
The management has indicated ebastine, a low volume high value product as another strong driver for growth over the next few years. BPL is planning to be a contract manufacturer for the Japanese and EU markets. The company is very close to receiving a CoS for the product. Domestic formulations market is estimated to grow at a CAGR of over 25% for the next two years. BPL is expanding its network in the North Indian region. The company has field force strength of 600MRs. The management has indicated that it is in negotiations with a foreign company,
which would acquire a strategic stake in BPL. The final decision is likely to be announced over the next six months
November 23, 2006
Opto Circuits (India) Ltd. CMP: Rs330 BUY
We met the management of Opto Circuits (India) Ltd (OCIL) for an update on the operations of its core business and EuroCor. While the core business is expected to record 30% plus revenue CAGR to Rs2bn over FY06-08, EuroCor is increasing its geographical coverage with presence in 29 countries. By the end of December 2006, EuroCor is expected to have presence in 36 countries. However, net margins for EuroCor may be subdued in the short term on account of heavy advertising and promotional expenditure. OCIL has indicated that its products have started gaining preference with cardiologists who attended various seminars, conferences and live workshops. As far as US market for stents is concerned, appointment of Dr. William Walter O’Neill on board is likely to expedite the process for USFDA approval, but it is still 18-24 months away.
The management indicated that they would look at acquisitions, which could be a good strategic fit over the longer term and available at the right price. We believe OCIL would consolidate operations of EuroCor in the near term and focus on increasing penetration in key geographies. OCIL is also looking at conducting certain low-end manufacturing operations for EuroCor in India. As OCIL is under 100% EOU till 2009-10, tax outgo on those operations will be nil, which will again cut cost and boost margins.
We are confident that OCIL will witness revenue CAGR of 63% to Rs3.7bn over FY06-08. We estimate EuroCor to contribute at least 30% to the total revenue and profitability by FY08. The core business is also witnessing continuous demand for its products from the international markets. We firmly believe that the company is on track to witness earnings CAGR of 61.1% to Rs1bn over FY06-08. At Rs330, the stock is trading at 28.8x FY07E EPS of Rs10.4 and 18.4x FY08E EPS of Rs16.3. We maintain a BUY from a 12-month perspective.
November 22, 2006
Strides Arcolab Ltd. Not Rated CMP Rs331
Strides Arcolab Ltd. (STAR) is one of India’s leading integrated manufacturers and exporter of finished pharmaceutical dosage forms with focus on niche molecules, which are difficult to manufacture or clinically difficult to prove efficacy. The company has significant presence in soft gels (18% of revenue) and sterile & immunosuppressant (32-35% of revenue). Semi-solids, another focus area, which could emerge as a significant growth driver for the company forms 10% of revenue. Finished dosage accounts for over 95% of the revenue for the company.
STAR has adopted a partnership model strategy for the regulated markets where it shares upsides and risks with its partners whereas it has set up its own front end for the semi regulated markets. STAR has 13 manufacturing facilities globally. The management has guided towards a 30% plus topline growth for CY06 and CY07 driven by increasing contribution from the regulated markets particularly America and Asia Pacific. Operating margins would start heading northwards as contribution from regulated markets increases. STAR is going through a consolidation phase post a series of acquisitions in 2006, full impact of which would be visible post H2 CY07. At Rs331, the stock is trading at 30.4x Q3 CY06 annualized EPS of Rs9.9.
November 21, 2006
Biocon Ltd. Not Rated CMP Rs265
Biocon Ltd., established in 1978, started as a manufacturer and exporter of enzyme. The company gradually shifted focus to a life science driven generic company with fermentation technology. Biocon is again going through a transition phase from being a generic company to a discovery led life science company. Statins sales will be a major growth driver in the short term, whereas immunosuppresants, non-injectable insulin, Monoclonal Antibodies (MABs) and custom research will be Biocon’s drivers in the longer run.
However it will take some time for Biocon’s key growth drivers to start delivering. Statins supplies for Simva and Prava have commenced to the US while Biocon commands a 30% market share for the European market. Pricing pressure has eased in the European market but it could be severe in US when competitors enter the market post exclusivity. Sharp growth in immunosuppreants would be triggered when key patents expire in US/ Europe in FY08-10. Oral insulin is a big opportunity for Biocon but competition from established players may be higher than expected.
Non-injectable insulin, a potential blockbuster is at least three years away from a potential launch. Biocon’s head & neck cancer molecule – BioMABEGFR has been launched successfully but will take some time to realize the full potential of the market. The only visibility in the near term is the continued growth momentum in the custom research space, which has witnessed revenue CAGR of 52% over FY01-06. Custom research projects are gaining increasing traction and are likely to maintain the current growth rate. At Rs358, the stock is trading at 20.9x H1 FY07 annualized earnings. We feel there is little downside to the stock from current levels but upsides could be capped unless key growth drivers start delivering earlier than expected
November 21, 2006
Thermax Ltd Q2FY07 and H1FY07 - Result Update.
Topline grows by healthy 26.2%, which is due to 30% growth in its energy division and 19.7% growth in its environment division. During the quarter the company’s revenue composition of domestic:export stands at Rs3800mn:Rs900mn. For the first half this stood at Rs6.4bn:Rs1.5bn. During the quarter contribution of energy to total revenues improved to 76.3% from 74.8% last year and for H1FY07 this was at 77% and 73.3% in H1FY06.
Operating margins for the company during the quarter expanded to 15.7% against 13.6% in the corresponding period last year. This is after negating Rs231mn of one time expenditure in ME Engineering and two other subsidiaries. Of this Rs105mn are towards ME Engineering and Rs120mn towards the two other subsidiaries. During the quarter raw material costs declined by 290bps which helped in margins expanding.
On a segmental basis the energy division experienced an expansion in margins by 330bps to 16.9% against 13.6%.
The company has accounted for operations and losses of ME Engineering over FY05, FY06 and H1FY07. Since the performance of the step down subsidiary has not been in line with the company projections the board of directors have decided to refer it to administration and as per the laws of UK. Henceforth no losses of the company will reflect in Thermax Ltd.
The order book on standalone basis stands at Rs26.6bn and consolidated basis stands at Rs29.7bn. This order (standalone) is 1.8x its FY06 revenues of Rs14.7bn. During the quarter, energy experienced 38% growth in orders inflows and environment registered 85% growth. It is undertaking two large orders of Rs4bn each with a delivery schedule of 17-23 months as against normal schedule of 14-16 months.
The company is in the midst of capacity expansion at its Baroda facility. It will be spending about Rs1.8bn at Savli, Gujarat. This facility is expected to commission within 12-18 months. Of this Rs1.8bn about Rs1.2bn will be spent on the boiler and heater division and the remaining will be spent on the cooling and heating division.
Thermax registered a bottomline growth of 68.2% to Rs582mn during the quarter against Rs346mn in the corresponding period last year. It closed H1FY07 with a bottomline growth of 65.4% to Rs857mn against Rs518mn in H1FY06. This translates into half yearly annualized earnings of Rs14.4.
With the order backlog more than doubling to Rs26.6bn the outlook for the company is positive in the near term. The only major risk will be in retaining its skilled workforce. The company’s effort to cater to an upsurge in demand is clearly visible from the capex being undertaken at Baroda. The management expects to close the year with a topline growth of about 30%. The stock is currently trading at 24.7x its half yearly annualized earnings of Rs14.4.
Indiainfoline - Special Report
Penny wise, pound foolish
More than 600-penny stocks (traded value of less than Rs 10 a share) have outperformed their high-priced peers and they have made themselves appear to be ‘penny wise’ and their peers ‘pound foolish’. Presently there are around 1700 penny stocks listed on the BSE, and surprisingly 37% of them have given returns of more than 100%. But, one thing must be noted that these counters are ‘high risk’ stocks. Investors have burnt their fingers in the past on account of the low liquidity that these counters offer and were unable to sell their shares when they wanted to exit these counters.
Consider this: one of the penny stock has given 3900% return (closing price as on Nov 22 subtracted by 52 week low price) in just over two months. Also, the counter is traded almost everyday with healthy volumes of around 1.5-2 lakh shares a day of late. That’s not the only penny stock with such an amazing return on capital at the stock markets. An analysis on all the stocks listed on the BSE reveals that there are 621 stocks that have offered returns of more than 100%. Yearly data shows that around 40-penny stocks have offered returns in the range of 500-5186% returns. And 560-odd penny stocks have offered returns anywhere between 100-500%.
But hang on! There are a lot of risks that these stocks carry. There is no doubt that there are many counters with a healthy mix of volumes, trades and players generating liquidity in the scrips. But, these stocks fall short to the number of counters with low liquidity. The ratio of stocks with high liquidity to low liquidity is approximately 2:5. Moreover, a number of counters trade regularly (at least once a week), but again many scrips virtually have no trades for weeks together. The ratio here would be 3:5. Also, many of these stocks are in the B2 category, which means that these counters are low cap scrips and may have very little floating stock. Further, many analysts do not research most of these companies and data available on company activities is very limited. That puts these companies in ‘high-risk’ zones.
And not all penny stocks rise. A further analysis shows that 140-penny stocks have actually fallen and the fall is as high as 91% (52 week high price subtracted by closing price as on Nov 22). There are 38 stocks that have fallen more than 80% and 69 counters have fallen between 51-79%
Indiainfoline - Investment Strategy
Gear up for a choppy week
The key indices have been rising without any meaningful breather for quite some time now. Relentless inflows from FIIs alone have been driving the rally on the back of robust economic expansion and stronger than expected earnings growth. The undertone remains positive as every major fall will see new foreign investors entering the market in place of the older ones. Even if there is a correction, which many analysts have been craving for, it may not be as bad as the carnage in May and June. We've seen in recent times that every time the market has fallen sharply, the bulls bounce back with renewed vigour. Those who have been left out of the recent rally are not getting any chance to enter as the momentum is just too strong. With the robust FII inflows continuing unabated all concerns over expensive valuations of Indian stocks are getting dissolved. However, we would advise you to not take large fresh positions at this juncture. Also, one should lock in some gains at every rise. As we approach the November F&O expiry, things could become more volatile. The market will take its cues from the rollover of derivative contracts into a new series. Things have been extremely choppy over the past few sessions. It won’t be any different for the coming week also. The long-term outlook remains intact. But, there will surely be some correction on the way, for which one should always remain on guard.
Indiainfoline - Market Mood
Bulls in 7th heaven
Now I'm high; running wild among all the stars above
Sometimes it's hard to believe you remember me
The bulls seem to be unstoppable, even at these levels. The key indices are hitting all-time highs almost every day. It is difficult to remember, that they were in complete mess just six months ago. Somehow, they managed to survive the carnage of May and now are running wild, not showing any sign of fears backed by good support from FIIs. The key indices raced ahead for the seventh week in a row, driven by buying in Power, IT, Infrastructure, Construction and Auto stocks. Capital Goods and Construction stocks were buoyed by pick up in infrastructure and construction activity and safe passage of the Indo-US nuclear deal. The party continued on the bourses with the NSE Nifty adding 2.5% or 98 points to close at 3950 and the BSE Sensex rising 2% or 274 points to 13703. NTPC, Bharti Airtel, REL, Satyam and TCS were the major gainers in the Sensex. Despite closing at a high, the markets were choppy.
Siemens had a roller coaster ride. The scrip managed to touch a high of Rs1407 on Thursday after bagging the largest ever order worth Rs40bn from Qatar. However, on Friday the scrip fell sharply following reports that six members of its parent company were arrested in Germany in connection with an investigation into a fraud. The company announced its Q4 results. Its net profit climbed by 31% to Rs1.37bn while the revenues at Rs15.63bn were up 56%. It will pay Rs3.8 per share dividend. Finally, the scrip lost over 1% to close at Rs1177.Metal stocks regained some of their lost shine after being on the receiving end over last few weeks. SAIL advanced 6.3% to Rs90, JSW Steel rose 5.2% to Rs332. Tata Steel gained 1.4% to Rs483 and Jindal Steel was up 13% to Rs120. Hindalco added 1.7% to close at Rs177. Tata Steel was in the news after Brazil's CSN unveiled a counter-bid for Corus. The scrip was among the major gainers on Friday. Tata Steel said that newspaper reports about the company's board raising the offer for the UK steelmaker are speculative.
Capital Goods stocks were in momentum. ABB advanced 4.8% to Rs3577, L&T rose 2.3% to Rs1386. Punj Lloyd jumped 8.3% to Rs960 and BHEL climbed 4.2% to Rs2528. Some bargain hunting was seen in auto stocks. Two-wheeler major Hero Honda rose 6.1% to Rs736, Bajaj Auto advanced 2.7% to Rs2633. Maruti gained 2.5% to Rs912 and Tata Motors was up 1.8% to Rs825.IT stocks outperformed the indices. Financial Technology led the gains, adding over 15% to close at Rs2139, i-flex rose 9%. Oracle postponed its plan to begin buying shares of i-flex by almost one month to Dec. 4 and also said it will pay an additional Rs11.35 for each share, boosting the stock up to close at Rs1647. Among the frontline companies, Wipro advanced 7.4% to Rs590, Satyam was up 6.5% to Rs461. TCS added 5.1% to Rs1148 and Infosys rose 2.2% to Rs2234.
Among the power stocks, NTPC led the gains, rising nearly 8% to end the week at Rs150. Reports that the company may be exempted by the Government from paying import duties on overseas purchases of power equipment boosted the stock. Also, action was seen across power stocks after the US Senate approved the Bush administration's plan to sell civilian nuclear technology and fuel to India. CESC rose 6% to Rs346, Suzlon Energy advanced 6.8% to Rs1474. Reliance Energy gained 5.6% to Rs543 and Tata Power added 3.5% to Rs576.
Donear Industries, manufacturer of textile products was a major gainer. The scrip soared 51% to Rs129 after Citigroup picked up 3.5 lakh shares at Rs90.2 and Merrill Lynch purchased 40 lakh shares at Rs90.1 on Nov. 22 on the BSE. Among the other mid-cap stocks, Century Textile jumped 7.2% to Rs635, Cummins rose 1.8% to Rs278 and Moser Baer climbed 9.6% to Rs277. Other notable gainers were Patni and Titan Industries.
Week Ahead - Profit taking may cap gain
Profit booking may emerge at higher level, after the key index – BSE Sensex has rallied 45.81% for the calendar year 2006. Foreign brokerage Merrill Lynch expects a slowdown in earnings growth of Sensex firms in FY 2008 (year ending 31 March 2008).
However the downside may be capped due to buying support from FIIs. They have invested Rs 7,220.60 crore for the month of November (till 21 November).
In the near term, the market would take cue from as to what extent the ruling government is able to pass some of the financial sector reforms. The winter session will debate, among other things, the Banking Regulation (Amendment) Bill, which proposes to increase the voting rights of foreign stakeholders in private banks presently capped at 10%. However, the Left parties are opposed to the amendment fearing that it will lead to a takeover of private banks by foreign entities. The winter session has just begun, and will last for almost a month.
Volatility may take centrestage in the next few days ahead of expiry of November 2006 derivatives contracts next Thursday (30 November).
Mirc Electronics, Dwarikesh Sugar, Tata Power Company, Ansal Properties & Infrastructure, Jindal Saw and Venky's (India) will announce their results in the coming week.
13,700 still intact
The market, which was in excellent form during the first-half of trading, eased in the second as investors began booking profits at the higher level. However, it succeeded in retaining the 13,700 level.
The BSE 30-shares Sensex finished with a modest 22.50-point gain, at 13,703.33. It had moved in the 13,767.85 - 13,665.52 range, for the day.
The S&P CNX Nifty settled 5.40 points higher, at 3,950.85.
The total turnover on BSE amounted to Rs 5,213 crore, boosted by four block deals of 15.30 lakh shares each, executed in HDFC in opening trade at an average Rs 1,662 per share. It was the top traded counter on BSE, with a total turnover of Rs 1,021.86 crore. The deals accounted for 2.4% of HDFC’s equity. The stock lost 0.25% to Rs 1,648 on a total volume of 61.48 lakh shares.
The turnover has been rising as the day of expiry of November 2006 derivative contracts, approaches.
The market-breadth stayed positive as small-cap and mid-cap stocks also benefitted from the rally on the bourses. For 1,336 shares that advanced on BSE, 1,195 declined; while 88 remained unchanged. The BSE Mid-Cap index was up 39.42 points (0.7%), to 5,654.71, while the BSE Small-Cap index gained 42.87 points (0.66%), to 6,523.03.
Among the 30-Sensex pack, 18 advanced while the rest declined.
NTPC was the top gainer, up 5.64% to Rs 149.95, on a high volume of 26.05 lakh shares. It struck a new 52-week high of Rs 150.70 following strong demand. As per grapevine, the company will benefit the most if the Indo-US nuclear deal finally sees the light of day.
Pharma major Dr Reddy’s advanced 2.53% to Rs 756, while FMCG major Hindustan Lever was up 1.02% at Rs 243.10.
Tata Steel rose 2.57% to Rs 483.55, on a volume of 15.34 lakh shares. The company brushed aside media reports about a sweetened bid for Corus Group, to stall the counter-bid by a Brazilian company. Soon after Brazil’s CSN on 17 November launched a counter bid for Corus, the Tata Steel stock started languishing with investors worrying that the steel maker will over-pay in a bidding war.
ONGC rose 1.16% to Rs 855, on reports that it is likely to win 21 blocks in the sixth round of the New Exploration Licensing Policy (NELP VI). Of the 21 likely to be awarded to ONGC, 12 are deep-water blocks.
Index heavyweight Reliance Industries (RIL) lost 0.90% to Rs 1,260, on 4.39 lakh shares. It had struck an intra-day high of Rs 1,274.50.
Hero Honda was the top loser, down 1.47% to Rs 735.95. It had hit a high of Rs 747.
The BSE Metal Index rose 120.58 points (1.36%), to 9,015.39. Welspun Gujarat Stahl Rohren (up 1.80% to Rs 85.25), Bhushan Steel (up 2.70% to Rs 351.40), Mukand (up 1.86% to Rs 85), Shree Precoated Steel (up 4.54% to Rs 502), SAIL (up 1.75% to Rs 90) and Hindalco (up 1.71% to Rs 178) moved higher.
Siemens plunged 8.34% to Rs 1,172.50, on a high volume of 14.21 lakh shares. The shares slipped for the second straight day, after the company came out with consolidated results, which were below market expectations on 22 November.
Zinc and cement producer Binani Industries lost 1.52% to Rs 354 ahead of the initial public offer of its subsidiary, Binani Cement. The stock had surged to a high of Rs 381.40. JP Morgan, which holds 25% in the Binani Cement, plans to sell 10.09% of it.
EMCO jumped 2.82% to Rs 673, after bagging a Rs 38 crore project for setting up a 400 Kv sub-station. The current order-book stands at Rs 830 crore, EMCO revealed.
Thomas Cook India dropped 1.2% to Rs 533.95, after it reported 64.8% fall in net profit for the October quarter. Thomas Cook India (TCIL) lost 3.60% to Rs 521.25 after it reported a sharp fall in net profit to Rs 3.08 crore for the quarter ended October 2006, compared to a net profit of Rs 8.76 crore for the quarter ended October 2005. The net fall in net profit was mainly because of the higher base effect – for the quarter ended October 2005, when the company had an extra-ordinary income of Rs 4.73 crore. Net sales rose 35% to Rs 38.03 crore, from Rs 28.10 crore.
Yes Bank jumped 9.52% to Rs 130, after RBI raised FII/NRI ceiling in the scrip to 49% of the share-capital. FII-holding in the scrip as on 30 September 2006, was 15.3% of the equity.
Gati advanced 3.20% to Rs 95.50, amid reports that Reliance Capital is eyeing 10 - 20% stake in the logistics company.
Igarashi Motors jumped 17.32% to Rs 149, after it scheduled a board meeting on 30 November 2006, to consider raising capital via preferential issue/QIP.
BPL rose by its maximum daily limit of 5%, to Rs 66.85, as its board decided to transfer the battery business to a joint venture, and to lease out the facilities.
Jayant Agro Organics jumped 12% to Rs 60, after it said it will consider raising more capital. The company’s board meets on 30 November 2006, to consider raising funds. Either a rights issue of equity shares or debentures, an issue of warrants, or floating of bonds will be considered by the board.
India's wholesale price index rose 5.29% for the year ended 11 November, marginally lower than the previous week's annual rise of 5.30% due to lower energy and milk prices, data showed on Friday. The annual inflation rate was at 4.09% during the corresponding week of the previous year.
The Nikkei average closed 1.13% down on Friday after hitting its lowest intra-day in two months, as shares of exporters such as Honda Motor Company slid on concern a higher yen will crimp earnings from abroad, and as banks and insurers fell after earnings reports. The Nikkei lost 179.63 points to 15,734.60 after earlier hitting its lowest point since late September.
Hang Seng index was down marginally by 0.03%, or 5.02 points, to 19,260.30.
FIIs continue to mop up Indian stocks, overlooking apprehensions of stretched valuations. As per provisional data, FIIs were net buyers to the tune of Rs 295 crore on Thursday (23 November), the day when the Sensex lost 26 points.
Mutual funds bought shares worth a net Rs 184 crore on 22 November 2006.
High volatility is expected in the next few days, ahead of expiry of November 2006 derivative contracts next Thursday (30 November). On Wednesday (22 November), the open interest in NSE’s futures & options segment hit an all-time high of Rs 57,158 crore. The previous record high was Rs 56,991 crore of 27 April 2006. 46% of the open positions are stock futures and 22% are index-based futures.
Sensex gains 22 points
Sensex Open:13667 High:13791 Low:13667
In a listless trading session, the market displayed a range-bound trend amid bouts of buying and selling. After opening 11 points below its last close at 13670, the Sensex moved up to touch an intra-day high of 13768. The index remained steady around the 13700 mark for a major portion of the session. The Sensex pared some of its gains on selling towards the close and ended the session at 13703, up 22 points for the day. The Nifty advanced five points to close at 3951.
The market breadth was positive. Of the 2,612 stocks traded, 1,355 stocks advanced, 1,173 stocks declined and 84 stocks ended unchanged. Among the sectoral indices the BSE Metal index, the BSE PSU index and the BSE CD index gained slightly over 1% each while the BSE CG index and the BSE OIL & Gas index finished lower.
Among the front-line stocks NTPC led the upmove and soared 5.74% at Rs150. Tata Steel surged 2.46% at Rs483, Dr Reddy's Laboratories advanced 2.40% at Rs755, Cipla jumped 1.75% at Rs264, Hindalco added 1.63% at Rs178, Wipro gained 1.44% at Rs590, ONGC rose 1.35% at Rs857 and HLL advanced 1.02% at Rs243. However, Hero Honda Motors dropped 1.43% at Rs736, L&T fell 1.12% at Rs1,387 and Bharti Airtel was down 1.09% at Rs616.
The stocks which touched new all-time highs on the BSE were Binani Industries at Rs381, BHEL at Rs2,557, Borosil at Rs286, Corcomp Infosystem at Rs107, Delco Remy at Rs202, Shivaji Securities at Rs33 and Sinnar Bidi at Rs286.
Over 61.49 lakh HDFC shares changed hands on the BSE followed by TVS Motors (41.37 lakh shares), SAIL (30.40 lakh shares) and NTPC (26.23 lakh shares).
Sensex ends with modest gains
The market, which was in excellent form during the first-half of trading, eased in the second as investors began booking profits at the higher level.
The BSE 30-shares Sensex finished with a modest 22.50-point gain, at 13,703.33. It had moved in the 13,767.85 - 13,665.52 range, for the day.
The S&P CNX Nifty settled up 2.65 points, at 3,948.10.
The total turnover on BSE amounted to Rs 5,213 crore, boosted by four block deals of 15.30 lakh shares each, executed in HDFC in opening trade at an average Rs 1,662 per share. It was the top traded counter on BSE, with a total turnover of Rs 1,021.86 crore. The deals accounted for 2.4% of HDFC’s equity. The stock lost 0.25% to Rs 1,648 on a total volume of 61.48 lakh shares.
The turnover has been rising as the day of expiry of November 2006 derivatives contracts, approaches.
The market-breadth stayed positive as small-cap and mid-cap stocks also benefitted from the rally on the bourses. For 1,336 shares that advanced on BSE, 1,195 declined; just 88 remained unchanged.
Among the 30-Sensex pack, 18 advanced while the rest declined.
NTPC was the top gainer, up 5.64% to Rs 149.95, on a high volume of 26.05 lakh shares. It struck a new 52-week high of Rs 150.70 following strong demand. As per grapevine, the company will benefit the most if the Indo-US nuclear deal finally sees the light of day.
Pharma major Dr Reddy’s advanced 2.53% to Rs 756, while FMCG major Hindustan Lever was up 1.02% at Rs 243.10.
Tata Steel rose 2.57% to Rs 483.55, on a volume of 15.34 lakh shares. The company brushed aside media reports about a sweetened bid for Corus Group, to stall the counter-bid by a Brazilian company. Soon after Brazil’s CSN on 17 November made a counter bid for Corus, the Tata Steel stock started languishing with investors worrying that the steel maker will over-pay in a bidding war.
ONGC rose 1.16% to Rs 855, on reports that it is likely to win 21 blocks in the sixth round of the New Exploration Licensing Policy (NELP VI). Of the 21 likely to be awarded to ONGC, 12 are deep-water blocks.
Index heavyweight Reliance Industries (RIL) lost 0.90% to Rs 1,260, on 4.39 lakh shares. It had struck an intra-day high of Rs 1,274.50.
Hero Honda was the top loser, down 1.47% to Rs 735.95. It had hit a high of Rs 747.
India's wholesale price index rose 5.29% for the year ended 11 November, marginally lower than the previous week's annual rise of 5.30% due to lower energy and milk prices, data showed on Friday. The annual inflation rate was at 4.09% during the corresponding week of the previous year.
The Nikkei average closed 1.13% down on Friday after hitting its lowest intra-day in two months, as shares of exporters such as Honda Motor Company slid on concern a higher yen will crimp earnings from abroad, and as banks and insurers fell after earnings reports. The Nikkei lost 179.63 points to 15,734.60 after earlier hitting its lowest point since late September.
Hang Seng index was down marginally by 0.03%, or 5.02 points, to 19,260.30.
FIIs continue to mop up Indian stocks, overlooking apprehensions of stretched valuations. As per provisional data, FIIs were net buyers to the tune of Rs 295 crore on Thursday (23 November), the day when the Sensex lost 26 points.
Mutual funds bought shares worth a net Rs 184 crore on 22 November 2006.
High volatility is expected in the next few days, ahead of expiry of November 2006 derivative contracts next Thursday (30 November). On Wednesday (22 November), the open interest in NSE’s futures & options segment hit an all-time high of Rs 57,158 crore. The previous record high was Rs 56,991 crore of 27 April 2006. 46% of the open positions are stock futures and 22% are index-based futures.
Market steady
The market has remained firm on lack of fresh buying in most of the counters. The Sensex touched a new intra-day high of 13768 earlier in the session, and is currently up 40 points at 13720. The Nifty has added nine points to 3954. The market breadth is slightly positive, with 1,427 stocks advancing and 1,051 stocks declining on the BSE.
Except the BSE CG index and the BSE CD index the remaining sectoral indices are in positive territory. The BSE Metal index and the BSE PSU index are the major gainers.
Among the gainers Pidilite Industries has gained 11.54% at Rs116, Adani Enterprise is up 9.98% at Rs202, IPCA Labs has advanced 7.89% at Rs474 and Sun TV has soared 5.05% at Rs1,475. On the other hand Siemens has shed 6.35% at Rs1,198 while Crompton Greaves is down 4.57% at Rs260.
BHEL touched an all-time high of Rs2,557 in intra-day trades. Currently it is up 0.48% at Rs2,529.
High turnover day
Turnover has picked-up sharply as the day of expiry of November 2006 derivatives contracts, approaches. BSE breached the Rs 3,000 crore mark, with three hours still left for trading to end.
Thanks to strong and sustained buying in frontline stocks, the market has remained firm.
At 12:37 IST the BSE 30-shares Sensex was up 69.12 points, at 13,749.95. It had moved in a range of 13,767.85 and 13,665.52.
The total turnover on BSE amounted to Rs 3,204 crore, boosted by four block deals of 15.30 lakh shares each, executed in HDFC in opening trade at an average Rs 1,662 per share. It was the top traded counter on BSE, with a total turnover of Rs 1,019.74 crore. The deals accounted for 2.4% of HDFC’s equity. The stock lost 0.64% to Rs 1,641.50 on total volumes of 61.35 lakh shares. The total turnover on Thursday was Rs 5,522 crore.
The market-breadth was strong as smallcap and midcap stocks contributed to the rally on the bourses. For 1,478 shares that advanced on BSE, 883 declined, while 84 remained unchanged.
Among the Sensex pack, 23 advanced while the rest declined.
NTPC was the top gainer, up 4.51% to Rs 148.35, on a volume of 11.31 lakh shares. It struck a new 52-week high of Rs 148.55 on strong buying. As per market grapevine, the company will benefit the most if the Indo-US nuclear deal finally sees the light of day.
FMCG major Hindustan Lever was up 1.60% at Rs 244.50.
Index heavyweight Reliance Industries (RIL) lost 0.07% to Rs 1,270.50, on 1.77 lakh shares. It had recovered form a low of Rs 1,265.
Wipro was the top loser, down 0.82% to Rs 577.15. It has recovered from an early low of Rs 562.25.
Among side-counters, EMCO jumped 6% to Rs 695, after bagging a Rs 38 crore project for a 400 Kv sub-station. The current order-book stands at Rs 830 crore, EMCO revealed.
Thomas Cook India dropped 1.2% to Rs 533.95, after it reported 64.8% fall in net profit for the October quarter. Thomas Cook India (TCIL) reported a sharp fall in net profit to Rs 3.08 crore for the quarter ended October 2006, compared to a net profit of Rs 8.76 crore for the quarter ended October 2005. The net fall in net profit was mainly because of the higher base effect – for the quarter ended October 2005, when the company had an extra-ordinary income of Rs 4.73 crore. Net sales rose 35% to Rs 38.03 crore, from Rs 28.10 crore.
FIIs continue to mop up Indian stocks, overlooking apprehensions of stretched valuations. As per provisional data, FIIs were net buyers to the tune of Rs 295 crore on Thursday (23 November), the day when the Sensex lost 26 points.
Mutual funds bought shares worth a net Rs 184 crore on 22 November 2006.
High volatility is expected in the next few days, ahead of expiry of November 2006 derivatives contracts next Thursday (30 November). On Wednesday (22 November), the open interest in NSE’s futures & options segment hit an all-time high of Rs 57,158 crore. The previous record high was Rs 56,991 crore of 27 April 2006. 46% of the open positions are stock futures and 22% are index-based futures.
Crude oil traded below $60 a barrel in New York on signs of mild weather in the US Northeast, which may delay demand from refiners making winter heating fuels. Crude oil for January delivery was at $59.12 a barrel, down 12 cents, in electronic after-hours trading on the New York Mercantile Exchange.
Prabhudas Lilladher: IPO Note - Sobha Developers
Prabhudas Lilladher in their IPO Note on Sobha Developers, say that they are positive regarding the prospects of Sobha Developers.
According to the research report by the brokerage house, Sobha Developers has land reserves of 2,593 acres, representing 118 mn sq.ft. of developable land at 78 locations in seven different cities in India.
On the valuation front, the company price band of Rs 550 to Rs 640, works out to P/Es of 32.3x and 37.6x the annualised EPS of Rs 8.5 for H1 FY07.
Prabhudas recommend 'Subscribe' for the issue at the upper end of the price band.
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Indiainfoline - Daily Market Strategy
Thanksgiving over...is it time for Black Friday?
Eat before shopping. If you go to the store hungry, you are likely to make unnecessary purchases.
The bears which slowly clawed back after some hibernation will hope the bulls have exhausted their shopping list. It's Black Friday on Wall Street (later in the day). And mind you Black Friday here does not mean a crash in the markets. The day after Thanksgiving is called "Black Friday." This is because retailers are said to finally move out of the red (representing losses) and into the black (indicating profits) as holiday shopping season commences ahead of Christmas. It's a day when the Wal-Marts and the rest of the retailers offer the best discount to lure larger customers.
For the bulls on Dalal Street, there are few stocks available at a discount or which are attractively valued. Most are trading at a premium. But then, if you have the money and are hungry, you may just end up buying things, even if it is expensive. Lightening of positions ahead of the F&O expiry next week could see the indices slipping into the red. A lot of outstanding positions have been built in the derivative segment. So, the near-term trend will hinge on the nature of the rollover. The market will remain volatile till then. Any bout of liquidity flow coupled with some short sellers caught in the 'wrong' counters could bring the bulls back to their feet.
The Wall Street was shut yesterday due to the Thanksgiving holiday. US shares had finished slightly higher on Wednesday. Crude oil futures were quoting nearly unchanged at $59.25 a barrel in extended trading in Asia.
Across the Atlantic, European markets closed lower. The French CAC-40 dipped 0.51% to 5,424.86. London's FTSE 100 fell 0.33% to 6,140.00. The pan-European Dow Jones Stoxx 600 index slipped 0.73% to 355.07, and the German DAX Xetra 30 finished flat at 6,476.12.
Asian markets were broadly lower in Friday's morning trade.
Japanese stocks fell, led by Mitsubishi UFJ Financial after Japan's government cut its forecast of the economy for the first time in almost two years. Honda and Sony dropped after the yen rose against the dollar to the highest in more than two months.
The Nikkei 225 Stock Average declined 219 points to 15,694 while the Hang Seng in Hong Kong was down 3 points to 19,261. The Kospi in Seoul shed 3 points to 1415.
Elsewhere in Asia, Australia's S&P ASX/200 was down 0.3% and Singapore's Straits Times fell 0.5%.
Among the emerging markets, the Bovespa in Brazil fell 0.4% to 42,069 while the IPC Index in Mexico added 0.2% to 24,730 and the RTS index in Russia gained 0.6% to 1712.
FIIs were net buyers to the tune of Rs2.95bn (provisional) in the cash segment yesterday. In the F&O segment, they were net sellers of Rs1.65bn. Mutual funds pumped in Rs1.84bn on Wednesday.
TCS could gain after Microsoft acquired a 10% stake in its China JV. There are also reports that it might win a big order from China.
Watch out for Maxwell Industries, the makers of the famous VIP brand of men's undergarments. A financial daily reports that Kishore Biyani's Future Group is in talks with the promoters to pick up a 26% stake in the company.
Insider Trades:
Mcleod Russel India Limited: Emerging Markets Growth Fund, Inc has purchased from open market 174305 equity shares of Mcleod Russel India Limited on 20th November 2006.
Mphasis BFL Limited: Anant R. Koppar, President has sold in open market 20000 equity shares of Mphasis BFL Limited on 16th November 2006.
Market Volumes:
The turnover on NSE was down by 15% to Rs88.84bn. BSE FMCG index was the major loser and lost 0.90%. BSE Technology index (down 0.57%) and BSE Oil & gas index (down 0.50%) were the other major losers. However BSE Capital Good index gained 1.17%.
Volume Toppers:
SAIL, DCB, India Cement, IVRCL Infrastructure, IDFC, Siemens, Unitech, ITC, Zee Telefilms, R Com, MTNL, Indiabulls, Mphasis BFL, Action Construction, Hindalco, Mahindra Gesco and GMR Infrastructure.
Delivery Delight:
ABB, Aftek Infosys, Bajaj Hindustan, Bank of Baroda, BHEL, BPCL, Colgate, Financial Technologies, I-Flex, India Cements, IVRCL Infrastructures, L&T, MTNL, NTPC, Suzlon Energy, Tata Power, Unitech and United Phosphorous.
Brokers Recommendation:
NTPC – Outperform from CLSA
Long Term Investment:
BHEL
Major News Headlines:
OBC signs MoU with IL & FS to provide trading facilities
Siemens Q4 net at Rs1.37bn (up 31%), revenue at Rs15.63bn (up 56%)/
Siemens to pay Rs3.8 per share dividend
Siemens to sell stake in telecom infrastructure unit to Nokia JV
Hindustan Zinc to spend Rs7.7bn to expand its Zinc and Power generation capacity
Petron Engineering bags Rs99.57mn order from Indian Oil
Microsoft buys 10% stake in TCS, China – Reports
BPCL subsidiary signs contract with Timor sea production sharing
Subex Azure wins contract from Middle-East Mobile Operator
Tantia Construction receives construction project from Bihar
Rajesh Exports launches 6 new showrooms
Indiainfoline - News Roundup
The three-day strike by Maharashtra petrol pump dealers has been called off. The agitation was in protest against the higher sales tax levy on petrol and diesel in the state. The decision was taken after the state government promised to cut sales tax on diesel soon. If and when the plan is implemented, diesel will cost less by Rs2 to Rs4 per litre while petrol prices are likely to remain unchanged.
Larsen & Toubro Ltd. is planning to spend Rs20bn on its proposed shipbuilding facility. The project will be finalised in January. The company is looking at locations in Andhra Pradesh, Gujarat, Maharashtra and Tamil Nadu.
Tata Tea Ltd. has hiked the price of packet tea by Rs4 to Rs6 across all its brands, except Agni, to pass on the higher input costs. This is the second price hike by Tata Tea in the current calendar year after January. Separately, the company is planning to launch a brand in the next two months. Tata Tea will also launch the country’s first branded green tea in bags.
ICICI OneSource, the BPO arm of ICICI Bank has changed its name to FirstSource. FirstSource also plans to tap the capital market. The company will launch an Initial Public Offering (IPO) of 95.6mn equity shares of Rs10 each through a 100% book-building issue. The offer comprises a fresh issue of 60mn shares and an offer for sale of 35.6mn shares by ICICI.
Siemens Ltd. announced its results for the quarter and year ended September 30, 2006. The company has posted a profit after tax of Rs1.37bn for the quarter ended September 30, 2006 as against Rs1.04bn in the same quarter last year. For the reporting quarter, total income (net of excise) is Rs15.63bn versus Rs10bn for the quarter ended September 30, 2005.
Hindustan Zinc Ltd is planning to enter into the wind power generation business. The company is in the process of setting up a 75 MW wind power plant in Gujarat or Karnataka and will invest Rs4bn for the same. The company also announced plans of investing Rs7.77bn into a de-bottlenecking project comprising of enhancing the zinc metal production capacity by 88000 MT at its smelters, installation of balancing equipments at mines and setting up of additional 80 MW captive power plant.
Kinetic Motors will acquire the entire Supa undertaking / business of Kinetic Engineering Ltd on Slump sale basis for Rs535mn. The business consists of 38 acre land situated at Ahmednagar, Maharashtra, Buildings, dies and moulde, plant & machinery and other related assets. Kinetic Motor will fund the acquisition through issuing preference shares for up to Rs300mn and will pay the balance in cash to Kinetic EngineeringVolatility may continue in early trades
The market is likely to witness down trend as major Asian gauges like the Nikkei, the Hang Seng index, the Kospi index are down marginally, while the Jakarta index have gained decent, though US Market ended with a positive note. Domestic indices might also reamin volatile through out the day. The Nifty has supports at 3930 and the Sensex has a likely support at 13625 and may face resistance at 13780.
US indices registered gains, with the Dow Jones closing above the level at 12327, up 5 points, while the Nasdaq moving up by 11 points to close at 2466.
Indian floats gained in US market and closed higher. Wipro advanced 5.07% at $15.74, Satyam gained 4.71% at $24.24, MTNL raised by 3.34% at $ 6.19, DR Reddy'd up by 2.12% at $16.40, and HDFC Bank gained 1.68% at $74.34 , ICICI Bank Infosys and Tata Motors gained about 1-2% each. while VSNL declined by 0.61% at $19.59 and Reddif dropped 3.7% at $19.26.
While the Nymex light crude oil for January delivery fell by 93 cents to close at $59.24 a barrel. In the commodity space, the Comex gold for February series jumped 30 cents to settle at $635.40 an ounce
Sensex may edge lower
Subdued to weak trend in Asian markets may weigh on the domestic bourses today. Shares in Asian exporters fell on Friday, hurt by a weaker dollar after the US currency plumbed a two-month low against the yen and a 5-½ month low to the euro. Japan’s Nikkei 225 average with a fall of 1.3% was the top loser among Asian equities.
On the flips side, the market sentiment may be boosted by hopes of a limited revival of government’s stalled divestment programme after the Union Cabinet on Thursday approved initial public offerings of three state run firms Power Grid Corporation, Power Finance Corporation and Rural Electrification Corporation.
The news comes at a time when the market is watching as to what extent the ruling government is able to pass some of the financial sector reforms in the winter session of the parliament. The winter session will debate, among other things, the Banking Regulation (Amendment) Bill, which proposes to increase the voting rights of foreign stakeholders in private banks presently capped at 10%. However, the Left parties are opposed to the amendment fearing that it will lead to a takeover of private banks by foreign entities. The winter session has just begun, and will last for almost a month.
The market sentiment remains bullish due to strong FII inflows and an upward revision in earnings growth guidance of corporates by brokerages on the back of strong Q2 results. FIIs continue to mop up Indian stocks ignoring apprehensions of stretched valuations. As per provisional data, FIIs were net buyers to the tune of Rs 295 crore on Thursday 23 November, the day when Sensex had lost 26 points.
But a correction may be in offing after a sharp surge of the Sensex in the past few weeks. The BSE Sensex is up 45.5% in calendar 2006 so far.
Volatility may take centrestage in the next few days ahead of expiry of November 2006 derivatives contracts next Thursday (30 November). On Wednesday (22 November), the open interest in NSE’s futures & options segment hit an all-time high of Rs 57,158 crore. The previous record high was Rs 56,991 crore of 27 April 2006. 46% of the open positions are stock futures and 22% are index-based futures.
The key data due today is the weekly inflation data.
Oil prices were steady, with NYMEX crude for January delivery trading at $59.24 a barrel.
EXCLUSIVE! - Business Today - The New Dotcom Millionaire - Infoedge CEO
In less than a decade, Sanjeev Bikhchandani has turned a garage start-up into India's only listed internet company worth Rs 1,000 crore on the stock markets. Where does he go from here?
It's a recent wintry morning, and Sanjeev Bikhchandani is sitting in a shoebox cabin at his corporate headquarters in Noida, near Delhi. "I never knew going public would require so many of my signatures," he grumbles, trying to clear a small pile of papers on his table. It has been just six days since his internet company InfoEdge began offering shares in itself to public, and much to the 43-year-old entrepreneur's delight, the IPO has been oversubscribed 55 times. There are reasons why Bikhchandani should feel proud about it. For one, it's the first internet stock to list in India and the first since Sify and Rediff listed on the nasdaq during the dotcom boom days of 1999-2000. For another, InfoEdge, which owns the country's #1 job portal, Naukri.com, stands to unlock about Rs 1,000 crore in shareholder value. Not bad for a portal that was born in a garage less than 10 years ago.
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EXCLUSIVE! - Business Today - India Inc's New MNCs
International acquisitions may be the most visible element of the global gambit, but Corporate India is also resorting to joint ventures and greenfield forays to set up overseas outposts. The Indian MNC is in the works.
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Movers & Shakers
- United Phosphorus notched up gains on reports that the company has acquired the global propanil herbicide business of Dow AgroSciences LLC.
- Petron Engineering advanced on bagging an order worth Rs9.95 crore from IOC.
- Rajesh Exports inched up marginally on reports that the company plans to launch six more Laabh showrooms in the country.
- Flawless Diamond slipped despite announcing the company's entry into the retail business.
- Gemini Communication moved up on bagging an order worth Rs20 crore for computerisation of village panchayats.
Sharekhan Investor's Eye dated November 23, 2006
Cement
Cement prices to remain firm
Key points
- Even as the consumption of cement grew at 9.25% in the first six months of the year, capacity addition remained insignificant during the period. As a result, the utilisation of the existing cement capacities remained firm at 95% and cement prices rose by 25% year on year (yoy) to Rs205-210 per bag in H1FY2007.
- With all the three demand drivers, ie housing, industry and infrastructure sectors, showing strong signs of growth, the cement consumption is expected to grow at a compounded annual growth rate (CAGR) of 10-10.5% for the next three years.
- As there are very few cement equipment suppliers around the world and there is an incessant rush for setting up cement plants, the lead-time for the supply of new plant equipment has gone up to 20-24 months from 12-14 months a year ago. Hence the cement capacity additions of 75 million tonne planned for the next 24-30 months are unlikely to meet their respective commissioning schedules.
- We believe a capacity of 60-65 million metric tonne (mMT) can be realistically added over FY2006-09. This implies a compounded annual growth of 12.5-13% in capacity addition over FY2006-09.
- Given that the demand for cement is expected to grow at a CAGR of 10-10.5% and capacity addition at a CAGR of 12.5-13% over FY2006-09, we believe the capacity utilisation will remain firm and cement prices will remain benign in FY2009 as well.
- We have upgraded our cement price projections for FY2007 and FY2008. We now expect cement prices to rise by 22.8% in FY2007 and by another 5% in FY2008. Consequently, we have upgraded our earnings estimates for the cement stocks in our cement universe. ACC and Shree Cement lead the chart of earnings upgrade with 24.6% and 22.4% for FY2008. We have also upgraded our price target for ACC, Shree Cement, Grasim Industries and UltraTech Cement.
- With the recent merger and acquisition (M&A) deals in the sector taking place at high valuations of USD110-125 per tonne, we believe a new valuation benchmark has been set for the cement companies. This should provide a fresh trigger to the cement companies that have under-performed the Sensex in the last three months.
- With the cement capacity addition projects feared to miss their respective commissioning schedules and cement consumption expected to see a strong growth in the next few years, the scenario in FY2009 looks reasonable enough for cement prices to rule firm. We maintain our positive view on the sector and rate Grasim Industries, UltraTech Cement and India Cements as our top large-cap picks in the sector. Among the mid-caps we like Shree Cement and Madras Cement. We also like Orient Paper and JK Cement on account of their compelling valuations, which are much less than the sector average.
VIEWPOINT
United Phosphorus
UPL makes its sixth acquisition
United Phosphorus Ltd (UPL) is clearly on an acquisition spree. It recently snapped up Dow AgroSciences LLC's global propanil herbicide business, marketed primarily as Stam™ herbicide. It is the sixth acquisition carried out by the company in this calendar year so far. Dow AgroSciences is a wholly owned subsidiary of The Dow Chemical Company with global sales of US$3.4 billion.
EXCLUSIVE! - India- 20 Companies To Watch In 2007
Even in ordinary times, putting together a list such as this one is a devilishly difficult task. After all, there's something or the other happening at every company. So, how do you decide which to drop and which to keep? And in these extraordinary times, zeroing in on 20 companies to watch is a million times harder. The economy is booming, companies large and small are betting big on acquisitions, new products, new markets, and new strategies. Private equity and venture capital is flowing into little-known firms, start-ups are mushrooming across sectors, and interesting new technologies are emerging both online and offline. Therefore, to bring you a list of 20 companies to keep an eye on next year, BT's reporters and editors across the country spoke to a variety of experts, including D-street analysts, fund managers, investment bankers, private equity and venture investors, bankers, and senior executives.
As you can imagine, the list we ended up with comprised more than just 20 companies. To whittle it down to the required number, we employed a few filters: One, the company needed to be most popularly cited by our experts; Two, the list needed to be well balanced in terms of the nature and size of companies; Three, the company should not have featured in our listing the previous year. However, we had to make an exception in the case of two companies-Tata Steel and Maruti Udyog-simply because they seemed to be on everyone's to-watch list. For good reason. Next year, Tata Steel will begin putting India Inc.'s biggest overseas acquisition, Corus, to work; next year, too, Maruti, having once retreated from the diesel car market, will again seek to displace Tata Motors' Indica as the diesel car of choice. The others also have a lot going for themselves.
ABB
Stepping Up the India Charge
It has grown for each of the past 24 quarters, upped revenues from Rs 1,000 crore to around Rs 4,000 crore in that time, and boosted profits from Rs 65 crore to analysts' estimate of Rs 290 crore this year. Is it possible then, that there's more steam left in ABB India, subsidiary of the Geneva-based power-automation-engineering giant? Yes, say analysts, because with the economy on a roll and investment in infrastructure and industrial projects gathering speed, ABB is plugged into a multi-billion-dollar opportunity. According to estimates, there are power and industrial projects in the pipeline worth several hundreds of crores. No wonder, ABB's order book is brimming over, with contracts worth Rs 4,211 crore over the next several years, and folks in Geneva have declared India a "prime focus" country. In response, the engineering giant is ramping up manufacturing capacities in the country. By the middle of 2007, it would have completed a $100-million (Rs 450 crore) investment programme that will not just boost throughput, but increase the breadth and depth of portfolio offerings in the market place. Says Ravi Uppal, Vice Chairman & MD, ABB India: "There is no cap on capex. We will continue to invest whatever it takes." Apparently, investors have no issues with the strategy. ABB India's stock price has almost doubled to Rs 3,490 in the last one year alone and trades at a p-e multiple of 51.
ADLABS
The Picture Gets Bigger and Better
Like in every good bollywood movie, the Adlabs' story has had a happy twist. "If you ask me whether I knew the business would assume this scale before July last year, the answer is no," says Manmohan Shetty, Chairman & MD, Adlabs. June 2005 was when Anil Ambani's Reliance Capital bought a majority stake in Adlabs Films. "The money, new talent, and management have helped create a media house present in every sphere of entertainment business," says Shetty, who runs a movies-to-film processing-to-multiplex group. How life has changed is evident not just from its Q2 results (revenues up 115 per cent to Rs 50 crore) but also investment plans. In the film production business, from investing Rs 15-20 crore a year hitherto, the company is now investing Rs 60-70 crore. It has struck a multi-film, co-production deal with Ashok Amritraj's Hyde Park Entertainment, set up a new animation arm that is already working on a 3D film called Superstar, and plans to invest Rs 40-50 crore in film distribution. Shetty is also looking to grow his 50-screen multiplex business fourfold, and scale up television content production following the purchase of a majority stake in Siddhartha Basu's Synergy Communication. Plus, "the demerger of the radio business is expected to unlock substantial shareholder value," says Chiraj Negandhi, an analyst with Enam.
AIRCEL
New Owner, New Plans
My mandate is to make Aircel a national player from a regional player," says Jagdish Kini, also answering the question why the erstwhile C. Sivasankaran-owned mobile services company made it to our list this year. As you might know, Malaysia's Maxis group (and Apollo) acquired Aircel in January 2006 and has since obtained licences to operate in nine circles. It has applied for 14 more as part of its plan to offer services across India. Maxis' proposed investment in cellular roll-out, 3G spectrum and WiMax is $3 billion, or Rs 13,500 crore. Aircel, which has 3.8 million subscribers mainly in Tamil Nadu, is betting on WiMax, or last-mile, wide-area wireless broadband (It WiMaxed Baramati with Intel). Neither the investments in nor the revenues from WiMax are expected to be significant, yet "Aircel hopes to get a first-mover advantage," says Ram Shinde, Aircel's Head (Business Solutions).
BARTRONICS
Coming Soon to Every Pack in Your Shopping Bag
Mumbai-based Karvy Stockbroking has been quietly accumulating the Bartronics stock since it was at Rs 55 about five months ago. And Ambareesh Baliga, the firm's Vice President, has no intentions of taking his eye off the stock, which now trades at over Rs 100. "It's one of the best proxy plays available in the organised retail space," says Baliga. What does the Rs 30-crore (at the end of March 2006) Bartronics do? The Hyderabad-based company makes a wide variety of data capturing equipment such as barcode scanners, terminals and printers, smart card readers, and RFID tags. Interestingly enough, retail is currently a small part of Bartronics' business, "but we believe it will definitely constitute a major portion of our business in the next two years," says MD & CEO Sudhir Rao. Accordingly, Bartronics is shifting focus to smart cards and point of sale (pos) systems, and hopes to become a Rs 200-250 crore company in another two years. RFID-based solutions fetched half of Bartronics' revenues in the first half of current fiscal. But Rao is betting big: "We are working towards a Rs 1,000-crore sales target," he says. Baliga must be smiling.
BHEL
Power-packed PSU
How's this for growth potential? India plans to add 674,000 mw of power capacity over the next 25 years, and there's only one end-to-end domestic manufacturer of power plants in the country: BHEL. "The company currently has limitless order intake and earnings visibility," quips Satyam Aggarwal, a power industry analyst at Motilal Oswal Securities. "There were some concerns over BHEL lacking supercritical technology (requiring a plant of at least 4,000 mw with constituent units of 800 mw or more), but those issues seem to have been sorted out," he adds. To some extent, yes. BHEL's Chairman & Managing Director, Ashok K. Puri, for instance, has struck deals with France's Alstom (for boilers) and Siemens (turbine generator sets) for supercritical plants for ultra mega power projects. More importantly, he's lined up Rs 1,000 crore for acquisitions abroad. "India must learn from the Dabhol debacle and acquire technology. Otherwise, we could be investing billions on buying equipment and not know how to run them," he says. BHEL's topline surged 41 per cent last year to Rs 14,525 crore, and this year it may cross Rs 20,000 crore.
BillDesk
They are Killing the Bill Queues
In early 2000, three Arthur Andersen executives-M.N. Srinivasu, Ajay Kaushal, and Karthik Ganapathy-quit their cushy jobs to launch a start-up out of a small house on suburban Mumbai's Carter Road. The trio thought they had a great payment management service idea (read: third-party bill collection) and, hence, kicked off IndiaIdeas. And, boy, were they right. Today, as many as 25 banks (Citi, SBI, HDFC Bank, among others) and more than 100 companies (including Hutch, Reliance Energy, Tata AIG) are part of IndiaIdeas' electronic payment gateway, BillDesk. "We are the largest player with over a million bills processed every month," says Kaushal. BillDesk already has 240 employees across 30 cities, but has plans of ramping up operations. "There is a huge potential. The share of online billing, which is less than 2 per cent, is expected to go up to 6-8 per cent in the next three to five years," says Kaushal. There are plenty of believers in BillDesk's business model. In June this year, SBI and us-based venture capital firm Clearstone Ventures invested $7.5 million (Rs 34 crore) in the company. So, expect an IPO a few years down the line.
DLF
The IPO is in Sight Again
The Delhi-based real estate giant DLF's initial public offering (IPO) may well have been a top contender for the most talked of non-event of the year. The company had been planning to roll out one of India's biggest-and realty's biggest-IPOs aimed at raising more than Rs 10,000 crore, until its minority shareholders cried foul and forced SEBI to show the red flag. When BT went to press, DLF, which had been valued between Rs 77,200-85,300 crore, had an extra-ordinary general body meeting coming up on November 14 to settle the issue. That means the IPO is in sight again. "If the minority shareholder issue is resolved, then the public offer could hit the market during the January-March quarter," confirms Rajeev Talwar, DLF group's Executive Director. The IPO, however, is not the only reason why DLF has made it to our list. The other reason is, of course, the real estate boom. The Indian real estate market estimated at $40-45 billion (Rs 1.8-2 lakh crore) is expected to grow at 20 per cent compounded annual growth rate over the next five years or so, according to UBS Investment Research. And DLF has plans for everything from houses to commercial buildings to SEZs. "Eventually each of (these) verticals should become large enough to become separate companies," says Talwar. Now, that is some ambition.
Dr Reddy's
The Recipe is Working
It's possibly the highest-ever quarterly sales announced by an Indian drug company. For the second quarter of this year, Dr Reddy's Labs announced a year-on-year 245 per cent growth in topline to Rs 2,004 crore and a 214 per cent jump in net profits to Rs 280 crore. If all goes well, Dr Reddy's will be pushing a billion dollars in revenues before 2007 is rung out. "The acquisitions added a lot of firepower to the business coupled with a few upsides," says company CEO, G.V. Prasad. The new acquisitions such as betapharm fetched a fifth of the Q2 revenues, and international sales made up an impressive 88 per cent versus 61 per cent same period last year. There are two other reasons to watch Dr Reddy's: One, its generic version of GSK's $1-billion drug Zofran (an anti-emetic), Prasad says, is likely to get an approval. That could mean Rs 225 crore in profits during the exclusivity period. Two, one of its new molecules (balaglitazone) for treatment of diabetes is expected to enter phase III of clinical trials over the next six months, making Dr Reddy's India's first company to have a phase III asset. Also, Prasad isn't ruling out more acquisitions abroad.
Ginger
Smart Basics for Road Warriors
It was an idea borrowed straight out of C.K. Prahalad's bestseller on bottom of the pyramid (bop) marketing. No surprises, then, that Indian Hotels' budget hotel subsidiary, Roots Corporation, is pleased as punch with the results. Its no-frills budget hotel Ginger, launched in June 2004, has been a roaring success. All Ginger properties (Bangalore, Mysore, Haridwar, Pune, Trivandrum and Bhubaneshwar) have a simple layout and design with around 100 rooms in each property. Since land price is a key determinant of the eventual tariff, most of these hotels are located on the outskirts or at least outside the central business district, where prices tend to be more reasonable. There's no room service or travel desk or swimming pool, but the rooms have everything a budget-conscious business traveler would need, including Wi-Fi. Also, there's a closed circuit camera in the lobby of all Ginger hotels for greater security. There are just two types of rooms, single bed (180 sq. ft) and double bed (220 sq. ft) with transparent prices of Rs 999 and Rs 1,199, respectively that are uniform across properties. "We call our model smart basics, which means good quality at affordable prices," says Prabhat Pani, CEO, Roots. By March 2008, Ginger hopes to be in 30 cities. Road warriors, rejoice.
GMR Infrastructure
The Long Road from Jute to Airports
If the Hyderabad airport gets up and running by April 2008 and Delhi too sports a spiffy new one by 2010, air travellers will have one Bangalore-based company to thank: GMR Infrastructure. The Hyderabad airport is a Rs 2,284-crore project, while Delhi's has a cost of Rs 7,000 crore. That should make GMR one of the biggest infrastructure developers. For a company that entered infrastructure only in the 90s, GMR has been able to bag some big projects. The airports apart, GMR has landed a number of road projects under the Golden Quadrilateral project. Focussing on project development, as opposed to mere execution, has enabled GMR, which once was in the jute business, to build assets worth Rs 15,000 crore from Rs 900 crore in 1999.
GMR executives say that the group has a healthy blend of fixed and volume-driven revenues. Investors in the newly-ipoed company have nothing to complain about. The stock is trading 70 per cent above the issue price of Rs 210. "As India's infrastructure needs explode, GMR Group will strive to meet them," says Chairman G.M. Rao. Investors expect as much.
Idea Cellular
Its Time Has Come
For Sanjeev Aga, the last several months have been incredibly busy. After the Tatas sold their stake in Idea to the Aditya Birla Group, the cellular services provider went on an overdrive and launched operations in three new circles (Rajasthan, Himachal Pradesh, and Uttar Pradesh-East), taking the tally to 11. Between March and September this year, the subscriber base jumped 54 per cent, and first half revenues rose 38 per cent to Rs 1,906 crore and net profit by 160 per cent to Rs 192 crore. "We are in a very strong position in the circles we operate and our renewed focus will help us to power ahead," states Aga, who has taken over as Idea Cellular's Managing Director from his earlier assignment as MD of Aditya Birla Nuvo.
The big story for Idea is yet to unfold, though. With a pan-India launch on the anvil and licence awaited for the National Long Distance Service (NLD) service, growth-and a place alongside Bharti, Hutch and Reliance Infocomm-appears inevitable. Then, there's the IPO story. With Idea already valued at Rs 12,000 crore following private equity investment from Providence Partners and ChrysCapital and its footprint growing, the company can only get more valuable. "To us, nothing is more important than Idea being a top-notch company. We want it to be a class act," says Aga in modesty. A good idea, tooKale Consultants
Reprogrammed, But Keeping Its Fingers Crossed
It's possibly the only reinvention of its kind in the Indian it industry and if it works, it may well inspire several other small companies to find their own niches. Founded in 1986, Kale continued to operate in a number of industry verticals but without achieving viable scale in any of them. Starting 2001, the Pune-based company began spinning out all the verticals (banking, generic software, and healthcare) and selling them to willing buyers. In October 2004, it acquired Cognosys, a travel solutions company, and merged it with itself. "We focussed on the airline vertical as we've had some global exposure there," says Vipul Jain, CEO & MD, Kale. With the result, the Rs 73-crore firm has emerged as a focussed airline software and BPO player, offering outsourced services to airlines that include passenger revenue accounting, cargo management and travel solutions for travel companies. Over the years, Kale has shifted to a 'per transaction' model from the "licensing model' it followed earlier. "We have the foundation. Now we are looking to leverage our position to cater to the entire travel industry," says Jain. Investors aren't yet convinced, since the stock has stayed stoically between Rs 90 and Rs 100 for a year now. Just the same, it's a reinvention worth watching.
Larsen & ToubroA Makeover on Many Fronts
Not too far in the future, Larsen & Toubro may look very different than what it does today. While its flagship engineering and construction business still fetches 70 per cent of the revenues, Chairman & Managing Director A.M. Naik seems determined to turn the conglomerate into a bigger and even more diversified entity. Among L&T's new forays are the ones into shipbuilding, defence equipment, and nuclear power. Simultaneously, Naik is pushing L&T into newer markets overseas in the core business. For instance, West Asia and China, he says, will be important makets. "Gulf (alone) will bring in $1 billion (Rs 4,500 crore) in revenues next year," says Naik. In power, L&T Power Development is moving from merely building power plants to running and maintaining them, thus creating steadier revenues. L&T Infotech, the IT arm, is planning to add 3,000 employees to the existing 8,000 by March 2008. Some time soon in the future, Naik expects 60 per cent of L&T's revenues to come from projects, 30 per cent from manufacturing, and 10 per cent from services, against 75, 20, and 5 per cent, respectively, at present. "Infrastructure is a long-term play and the most demanding one," he says. And few Indian companies can claim to have the sort of execution skills that L&T has.
Maruti
Driving (Back) Into Diesel
As a rule, a company never gets to be on our "to watch" list for two years in a row. If we are breaking that rule for Maruti, it's for good reason. Next year is when the market leader will ride back into the diesel segment with a vengeance, putting pressure on Tata Motors' small car, the Indica. This will mark Marurti's second foray into diesel. The first attempt, made on the back of Zen diesel, didn't quite work. This time around, Maruti is dropping a 1.3-litre diesel engine into the hot selling small car, Swift. Between the first and second attempt, Maruti has increased car making capacity from 4 to 6 lakh per annum, and also set up a diesel engine plant at Manesar near Gurgaon with an annual capacity of 3 lakh engines. "I look forward to 2007 with cautious optimism. There has been strong growth in this fiscal so far. This is a decisive year when many of our new projects go on stream," says Maruti's MD, Jagdish Khattar. The small diesel car segment accounts for 13 per cent of the car market. Expect the fight between Maruti and Tata Motors to be bruising.
Praj IndustriesBetting on Biofuels
Be it the US or India, venture investor Vinod Khosla is a tough cookie. So, when Khosla, a former partner at Kleiner Perkins, decided to pick up a 10 per cent stake in a little-known Pune-based company, Praj Industries, people sat up to take note. Some years ago, India's stock market bull, Rakesh Jhunjhunwala, had also picked up an identical stake in Praj. What's special about the Rs 267-crore company? To put it simply, ethanol. Praj, promoted by IIT alumnus Pramod Chaudhari, specialises in setting up ethanol machinery and has executed projects across five continents. "We are the only company out of India offering end-to-end solutions in ethanol," says the 57-year-old Chaudhari. Over the last 10 months, Praj has received an equal number of export orders, especially from the US. Chaudhari's target: Make Praj a Rs 1,000-crore company by 2010. If ethanol-blended fuel takes off in the future, Praj will soar in tow.
Reliance Retail
The Game Changer
Back in may this year, reliance fresh was just a gleam in the eye of executives at Reliance Retail. By the end of October, they had launched the first store on Hyderabad's Banjara Hills. That's just one reason why Reliance is like an elephant in India's organised retail industry. The other is, of course, the fact that no one else has the kind of investment plans hat Reliance has: Rs 25,000 crore across formats and across categories, ranging from produce to groceries to footwear to consumer durables, and vertically integrated supply chain. In 2007 (and beyond) more of Reliance's retail strategy will unfold, potentially rattling existing players. "The end goal," says Raghu Pillai, President and Chief Executive (Operations and Strategy), Reliance Retail, "is clear and that is to cover across all formats, 100 million sq. ft of retail space and have a topline of Rs 1 lakh crore by 2010-11." Seems patently Reliance.
Shriram Transport Finance
Trucking On All Over
Financing commercial vehicles isn't a terribly exciting business to be in. Three-fourths of the fleet owners who get their trucks financed own less than five trucks. Most of them are semi-literate, but that's not the only reason why they aren't the easiest of customers to handle. Yet, if private equity investors such as Citi, Newbridge and ChrysCapital have been falling over each other to get a piece of Chennai-based Shriram Transport Finance, it's because the company knows how to make the business throw up oodles of cash. With Rs 9,000 crore in assets, Shriram churns out net interest margins of 9 per cent and logged a net profit of Rs 140 crore last year. And according to a study commissioned by Shriram, the opportunity for truck financing is set to boom. The study estimates a minimum potential demand of Rs 45,000-50,000 crore over the next 10 years. Of that, financing pre-owned trucks less than four years old and trucks between five and 10 years old, segments where Shriram dominates, will account for Rs 40,000 crore. Besides, the firm has also started financing new trucks, where it already has a 10 per cent share. "All the new trucks that are bought will come to us for modernisation funds once they are four years old," says the company's Managing Director R. Sridhar. By March next year, the company will grow assets to Rs 10,500 crore. Moral of the story: Businesses needn't be exciting; they only need to be profitable.
Tata Steel
Now Comes the Tough Part
At Bombay House, the Tata Group headquarters, celebrations over the $8-billion (Rs 36,800 crore) Corus acquisition are long over. B. Muthuraman, Tata Steel's Managing Director, is already hunkering down for hard work next year. "For us, the most important thing is to complete the deal in time (by January 2007) and then being prepared for the synergies to be worked out thereafter," says the man about India Inc.'s biggest overseas acquisition so far. What Tata Steel makes of Corus-a much larger steel manufacturer, but much less efficient than the Indian buyer-will be important not just for the Tatas, but for Indian industry in general. After all, Tata Steel will be raising $6 billion (Rs 27,600 crore) in debt to fund the purchase, and how it handles a downturn-if any comes along-will be keenly watched by analysts and others. "We will be sharing our best practices. There will be operational synergies, market synergies, synergies on logistics management and on so many other areas," says Muthuraman. One way or another, it has all the makings of a B-school case study.
TransWork
New Worlds to Conquer
A year ago, transworks, the Aditya Birla group's BPO arm, was just one of the 200-odd BPO companies in India. But on July 3 this year, the Mumbai-headquartered operator changed all that with just one deal when it acquired the Santiago, Chile-based Minacs for $125 million (Rs 558 crore then) and in the process shot up the bpo rankings to #2. From being a company with revenues of Rs 164 crore, TransWorks metamorphosed to a Rs 1,350-crore vendor. "With the acquisition of Minacs, the company (which has more than doubled the headcount to 10,000) operates out of 25 centres spanning North America, Europe and India, and delivering services in 28 languages," says Atul Kanwar, Managing Director, TransWorks. "We will be adding facilities in Canada, India & the Philippines in the near term to deliver an expanded range of services and solutions to our global customers." Translation: watch TransWorks.
Videocon Industries
Raider in a Hurry
When it comes to numbers, Venugopal Dhoot rolls them out faster than TV sets off assembly lines in his factories around the world. "We have set a goal to be a $10 billion (Rs 45,000 crore) company in the next three years (from Rs 18,000 crore today) and by December 2007, the hope is to have a market cap of Rs 25,000 crore (compared to about Rs 11,000 crore at present and Rs 5,000 crore last year)," says the Chairman of Videocon. If not too many today doubt Dhoot's determination, if not numbers, it's because he's won everyone's respect in a spectacular fashion. In August last year, he acquired Thomson's global picture tube business for Rs 1,300 crore and Electrolux Kelvinator India for Rs 400 crore, and is now close to gaining a controlling stake in Korea's debt-ridden Daewoo Electronics in a deal worth Rs 3,300 crore. "The next three months will see some consolidation happening, but that doesn't mean we will go slow on acquisitions," declares Dhoot. "Next year is going to be hectic." Better believe him
HOW THE 20 COMPANIES TO WATCH IN 2006 HAVE PERFORMED
Air Deccan
Has not had it easy. Its IPO in May drew a lukewarm response, forcing it to reduce its price band. On June 30, 2006, reported losses to the tune of Rs 340 crore for a 15-month period, despite which the airline has announced it would offer one lakh tickets for as low as Rs 9.
Bilcare
In October this year, it acquired DHP, a UK-based clinical trials services provider, for $5 million (Rs 22 crore). The company intends to evolve itself into a life sciences knowledge partner.
CavinKare
CavinKare is entering the home hygiene market with the launch of Tex, a toilet cleaner, tapping the Rs 100-crore toilet cleaner market. This year, the CavinKare group's turnover is expected to reach Rs 575 crore as against Rs 572 crore in '05-06.
Centurion Bank (now Centurion Bank of Punjab)
The bank, which completed its merger with Bank of Punjab in September last year, is currently in the news for its merger with Lord Krishna Bank, which has run into some rough weather.
DQ Entertainment
Plans to raise around $100 million (Rs 450 crore) to help its private equity investors exit and support its major expansion plans. It is also opening new facilities both within and outside the country.
Geometric Software
In October this year, it acquired the engineering services division of US-based Modern Engineering for close to $32 million (Rs 144 crore), with about $7 million (Rs 31.5 crore) in working capital loan. Just a few days after the acquisition, there were reports that the Godrej Group now wants to sell its stake (18.5 per cent valued at Rs 150 crore) in the company and is looking for potential buyers.
GVK Biosciences
Things are still looking up for a company that was one of the pioneers of bioinformatics in the country. In January, Wyeth Pharmaceuticals outsourced research services to GVK Bio; the deal was reportedly worth $8-10 million (Rs 36-46 crore).
Indian Rayon (now Aditya Birla Nuvo)
The company has had a good year, especially the last quarter, reporting a nearly 40 per cent jump in profits in the corresponding quarter from the previous fiscal.
Maruti Udyog
The government looks set to divest its 10.27 per cent stake in the company and is awaiting the Cabinet's nod. The launch of an LPG version of WagonR by Maruti Udyog in July has done wonders for the 'tall boy' multi-activity vehicle, with sales more than doubling. Sales of WagonR Duo touched 13,200 in October, up 116 per cent over the July numbers of 6,100 units.
Midas Communication Technologies
In June this year, it came out with a new switch that enables faster deployment of cable internet. Called Catius, the new solution is targeted at the local cable operators (LCO) segment.
NTPC
Is hiring aggressively; plans to hire at least 1,000 people every year for the next three years. NTPC seems on course to add 22,000 MW capacity by 2012.
Rico Auto
Has benefited from the growing auto story. Like its competitors, Rico Auto is scaling up from producing individual components to making assemblies and systems. Has, however, registered a modest 14 per cent topline growth in Q2 this fiscal with a decline in bottom line (largely attributed to rising aluminium costs).
State Bank Of India
Was the only large PSU bank to register a fall in its net earnings (its net fell by 2.5 per cent) in Q2. The stock has, however, done well and has risen by about 20 per cent in the last six months. The bank, India's largest, is eyeing a global presence, especially in markets like the West Asia.
Symphony Services
The $100-million (Rs 450 crore) firm is in an expansion mode; in June this year, it opened a second facility in Bangalore with plans to double capacity in Pune. It may also set up base in China. Symphony has registered 170 per cent compounded annual growth from 2002 to 2005.
Tata Steel
After acquiring Anglo-Dutch giant Corus, the company is all set to enter the Fortune 500 list, only the seventh Indian company that would be on the list. The combined entity would have revenues of over $22 billion (Rs 99,000 crore). The company hopes to return to its annual margin of about 30 per cent in the next four to five years.
Tejas Networks
This leader in next generation optical networking products has acquired $20 million (Rs 90 crore) in new equity financing. It plans to use this money to fund its international expansion plans and for R&D to develop packet-aware optical products. The company is eyeing Rs 250 crore in revenues this fiscal, up from Rs 130 crore during 2005-06.
TKML
It says it plans to launch a small car in the next two-to-three years and would look at a 10 per cent market share in the segment by 2010. It also plans to set up a second facility with a capacity of 150,000 units in Karnataka near its existing plant in Bidadi, near Bangalore.
United Spirits
After reaching the US and Europe, UB's Vijay Mallya is all set to enter China and Russia. In September this year, UB acquired France-based wine manufacturing company Bouvet Ladubay, which gave it a strong distribution network to sell its products in the European and American markets, while helping tap the rapidly growing market for wines in India. The company has a 55 per cent share in the IMFL category.
Vimta Labs
In January this year, the company decided to raise Rs 125 crore to fund the second phase of expansion. The company inaugurated its new facility in March in Hyderabad.
WNS
When WNS Holdings listed on the NYSE in July 2005 (it raised $224 million), Indian stock markets were in the grip of a downturn after the May-June crash. But the stock has held up and is trading at 50 per cent higher than the price it was listed at. The company soon plans to enter East Europe and does not rule out using part of the money raised for acquisitions.
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