CMC target , Buzzing Stock, stock advice, Stock CUES, Stock in News, Buy Call, Target,Recommended price
Fairwealth Securities has recommended buy rating on CMC with a target of Rs 1530, in its research report.
“CMC synergistic relationship with TCS, CMC is gearing itself in IT industry. In embedded systems, the Company is seeing growth in US, UK and Europe. In Government segment, the Company is seeing traction in treasury management, HRMS systems for various states, energy sector (APDRP, billing), GST related migration. In private sector, the Company is expecting growth from Insurance and Financial sector (depository product), banks. The Company has a good base in Insurance space with 80% of market. The Company would be focusing on the transportation vertical, in e-Governance space with TCS and in Defense space. In the private space it is looking at cross-selling solutions & services. The Company is seeing new services like video surveillance, identity management and large corporate are going for offshore. The company would be re-looking at its franchisee business in E&T SBU. The Company is seeing growth in corporate training business. The Company is focusing on value added services and cost effective niche solutions as CMC already has a rich portfolio of industry specific assets.”
“Phase I of the SEZ has been completed. Phase II would be completed by June 2011 with a capex of Rs 155 crore over 2 years. The Company won defense contract in Q2FY2010 which will improve margins in future as these contracts are all long term contracts. The average deal size is Rs 5 – 10 crore with engagement of 2-3 years. SI with 41.43% PBIT margin in Q1FY10, we see scope of tremendous growth in this SBU which going forward will improve margins for company. Its Egovernance business has a huge potential for growth. Company expects operating profit margin to grow to 20% in next 6-12 months. Presently its stands at 18%, highest ever for the company,” says Fairwealth Securities research report.
Fairwealth Securities has recommended buy rating on CMC with a target of Rs 1530, in its research report.
“CMC synergistic relationship with TCS, CMC is gearing itself in IT industry. In embedded systems, the Company is seeing growth in US, UK and Europe. In Government segment, the Company is seeing traction in treasury management, HRMS systems for various states, energy sector (APDRP, billing), GST related migration. In private sector, the Company is expecting growth from Insurance and Financial sector (depository product), banks. The Company has a good base in Insurance space with 80% of market. The Company would be focusing on the transportation vertical, in e-Governance space with TCS and in Defense space. In the private space it is looking at cross-selling solutions & services. The Company is seeing new services like video surveillance, identity management and large corporate are going for offshore. The company would be re-looking at its franchisee business in E&T SBU. The Company is seeing growth in corporate training business. The Company is focusing on value added services and cost effective niche solutions as CMC already has a rich portfolio of industry specific assets.”
“Phase I of the SEZ has been completed. Phase II would be completed by June 2011 with a capex of Rs 155 crore over 2 years. The Company won defense contract in Q2FY2010 which will improve margins in future as these contracts are all long term contracts. The average deal size is Rs 5 – 10 crore with engagement of 2-3 years. SI with 41.43% PBIT margin in Q1FY10, we see scope of tremendous growth in this SBU which going forward will improve margins for company. Its Egovernance business has a huge potential for growth. Company expects operating profit margin to grow to 20% in next 6-12 months. Presently its stands at 18%, highest ever for the company,” says Fairwealth Securities research report.
To read the full report click on the attachment
Attachments : BuyCMC_Fairwealth.pdf
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