Car News

BUY NATIONAL HYDRO POWER CORPORATION (533098)
CMP: 24
Target: 40 in 6 months
National Hydro Power Corporation, an entity of Government of India, is
country's largest hydro power producer.
NHPC is currently having an installed capacity of more than 5,300 MW
with 14 operational power stations and has a cash surplus of over Rs.
4,000 crore.
Net profit of NHPC rose 47.19% to Rs. 791.05 crore in the quarter
ended June 2011 as against Rs.537.42 crore during the previous quarter
ended June 2010. Sales rose 40.37% to Rs.1431.41 crore in the quarter
ended June 2011 as against Rs.1019.71 crore during the previous
quarter ended June 2010.
The state-run major is engaged in the construction of 10 projects at
various locations in the country, going to have an additional capacity
of 4,502 MW. It is planning to develop two hydro projects in Myanmar.
It plans to increase the capacity to over 10,000 MW by end of 2012.
The coal price is expected to rise by 2012, which will result in
increase in power price by 20%. This will further boost the profit
margin of NHPC to a large extent.
Spanning on Government's increasing emphasis on hydro power and NHPC's
strong hold, we recommend a BUY on NHPC at CMP of Rs 24, with a target
of Rs.40 in 6 months.

BUY FIRST SOURCE LIMITED (532809)
CMP: 12
Target: 24 in 4 months

Firstsource is a global BPO (business process outsourcing) service
provider, and is ranked #25 amongst the world's leading Global
Outsourcing companies by IAOP. They provide customized BPO solutions
to category leading companies in several industries including Banking
& Financial Services, Telecom & Media and Healthcare sectors. FSL
utilize global delivery model with operations in the USA, UK, India
and The Philippines. They are expanding their Asia business unit.
With more than 27000 employees, its revenue earning for FY 2010-211 is
US $ 44.8 2016 Crore.
Total income from operations rose to Rs.523 crore during the April-
June quarter of 2011, compared to Rs.490.70 crore in the same period
last year. The volumes have risen by 6.6% on a yearly basis and 7.3%
in constant currency terms.
FSL sees a significant growth in Asia business unit, which is a
positive trend. In June quarter, they expanded their workforce by 25%
by adding 3000 new employees.
The expansion of workforce gives light on the increasing work of FSL
which shall be reflected in the coming quarters.

With expansion in geographical dimensions, increasing capacity and
work load, FSL is bound to grow at a higher rate. We recommend a
strong BUY with target of Rs.24 in 4 months.

BUY NEYVELI LIGNITE CORPORATION LIMITED (513683)
CMP: 82
Target: 150
NLC is a government-owned lignite mining Indian company, which is
wholly owned by the Union Government (49%) and administered via coal
ministry. It is recently announced as "Navratna" by Government of
India in April 2011. NLC Neyveli spreads over an area of around 54
square km, comprising Neyveli Township and temporary colonies around
32 blocks. The company runs the biggest open-pit lignite mines in
India and mines around 2.4 Crore tonnes of lignite annually for fuel,
with an installed capacity of 2490 MW of electricity per annum.
NLC now elaborated its project to Rajasthan also in mining as well as
thermal stations, 3 big mines also supplies a huge amount of sweet
water to Chennai. The Tamil Nadu electricity board has a JV with the
Neyveli Lignite Corporation Ltd (NLC) for two projects – A 1000-MW
coal-based project at Tuticorin in southy Tamil Nadu at the cost of Rs.
4000 crore and the Jayamkondam lignite power project at a cost of Rs.
5000 crore for 1000 – MW power plant.The company has also planned to
develop clean coal technologies like extraction of coal bed methane
(CBM) and Underground coal gasification for which several steps have
been taken.
Total income has increased from Rs.1258 Crore for the quarter ended
June 30, 2010 to Rs.1425 Crore for the quarter ended June 30, 2011,
representing increase of 13.28%.
Neyveli Lignite is an open-cast mechanized lignite mine. The Company
has 50 percent joint venture with Tamil Nadu Electricity Board and its
announced its plans to invest about Rs.36,900crore on power generation
and mining capacity augmentation by 2017. The plan also includes
development of power projects using other fuel feed. The company is
also planning to invest Rs.40,200 crore to build power plants in Tamil
Nadu, Rajasthan and Uttar Pradesh.
Strong expansion & diversification plans to explore coal-based, wind
and solar power generation projects will add on strength to the
cashbook.
We recommend 'BUY' on the stock at CMP 82 with a target price of Rs.
150 in 5 months

TATA COMMUNICATION (500483)
CMP: 192
Target: 250 in 2 months

Tata Communications Limited along with its global subsidiaries (Tata
Communications) is a leading global provider of the new world of
communications. The Tata Global Network encompasses one of the most
advanced and largest submarine cable networks, a Tier-1 IP network,
connectivity to more than 200 countries across 400 PoPs and more than
10 lac square feet data center space. Tata Communications serves its
customers from its offices in 80 cities in 40 countries worldwide.

The number one global international wholesale voice operator and
number one provider of International Long Distance, Enterprise Data
and Internet Services in India, the company was named "Best Wholesale
Carrier" at the World Communications Awardsand was named the "Best Pan-
Asian Wholesale Provider".

Tata Communications Ltd. is a part of the $6740 Crore Tata Companies;
it is listed on the Bombay Stock Exchange and the National Stock
Exchange of India and its ADRs are listed on the New York Stock
Exchange (NYSE: TCL).

Total income rose to Rs.3294.33 Crore during the April-June quarter of
2011, compared to Rs.2900.44 crore in the same period last year.

Tata comm has made conscious efforts to diversify from its core
wholesale voice business and tap the higher margin managed services
and cloud business.

We believe the stock is a good opportunity point as long term drivers
are intact as addressable market opportunity leaves tremendous scope
for expansion stock may go up by 40%.
We recommend 'BUY' on the stock at CMP 192 with a target price of Rs.
250 in 2 months

DISCLAIMER:- Smart Profit has taken due care and caution in
compilation of data for its reports. The market view and investment
tips expressed on Smart Profit are in no way a guarantee either
express or implied. However, Smart Profit does not guarantee the
accuracy, adequacy or completeness of any information and is not
responsible for any errors or omissions or for the results obtained
from the use of such information. CEO, Directors and staff may have a
position in the recommended stock.

Contact Details

DIPAK MANGELA
(Research Analyst)
Email: dipak.mangela@smartprofit.in
Tel : 9820260291

MANSINGH RAI
(Senior Executive)
Email: mansingh.rai@smartprofit.in
Tel : 9320907684

SHAILESH GOWDA
(Senior Executive)
Email: shailesh.gowda@smartprofit.in
Tel : 9967394114

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