Market Watch as on Jan 30, 2008

We scan dozens of research reports from investment houses every fortnight to present you the six most relevant stock recommendations.

Print Edition: 21 Feb, 2008

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We scan dozens of research reports from investment houses every fortnight to present you the six most relevant stock recommendations.

GLENMARK PHARMA

Edelweiss Securities: "In the third quarter of 2007-8, Glemark's net sales grew 55% YoY while its net profit grew by 48%. The US business continued its strong growth, posting revenues of $50.5 million. Domestic markets posted a growth rate of 8%, with revenues of Rs 121.4 crore. We maintain our Buy recommendation."

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Recommendation	BUY
Stock Price	Rs 483.75
One-year returns	53.33%
Profit Margin	258.36%
Q3 PE ratio	81.6

ICICI BANK

Emkay Research: "In the third quarter, ICICI Bank's net interest income grew by 32% YoY to Rs 1,960 crore and fee income grew by 33%. But it has continued to disappoint on the asset quality; it has added nearly Rs 600 crore of fresh non-productive assets. We maintain Buy recommendation with a price target of Rs 1,600."

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Recommendation	BUY
Stock Price	Rs 1187.4
One-year returns	24.21%
Profit Margin	31.63%
Q3 PE ratio	107.36

NIIT TECHNOLOGIES

Emkay Research: "In the third quarter, NIIT's revenues grew by 1.7% QoQ to Rs 233.8 crore, while net profit stood at Rs 34.7 crore up 0.9% QoQ. Its UK subsidiary is undergoing a platform transition, which has impacted growth. Though valuations have cooled down, we recommend Buy with a target price of Rs 255."

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Recommendation	BUY
Stock Price	Rs 135.15
One-year returns	-50.62%
Profit Margin	19.81%
Q3 PE ratio	27.81

GRASIM INDUSTRIES

IDFC-SSKI: "Grasim's third quarter net sales increased by 15.3% YoY to Rs 2,630 crore, on the growth in viscose staple fibre and sponge iron realisations. We expect cement earnings to come under pressure in 2008-9. However, cash flows from VSF and sponge iron will cushion earnings. We retain Outperformer rating."

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Recommendation	BUY
Stock Price	Rs 2995.25
One-year returns	5.66%
Profit Margin	47.23%
Q3 PE ratio	49.59

KIRLOSKAR OIL ENGINES

Reliance Money: "KOEL's engine segment reported sales growth of 31% YoY to Rs 510.1 crore and auto component segment grew by 7% YoY to Rs 34 crore. The company is undergoing major expansion and investing around Rs 900 crore. We recommend a Buy with a target price of Rs 162."

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Recommendation	BUY
Stock Price	Rs 127.45
One-year returns	-3.96%
Profit Margin	-33.07%
Q3 PE ratio	113.79

POWER FINANCE CORPORATION

Prabhudas Lilladher: "PFC posted 41.4% YoY growth in its net interest income for nine months of 2007-8 to Rs 1,320 crore. It has joined hands with USbased Clear Investments to float a $1 billion private equity fund. We maintain Outperformer rating on the stock with a price target of Rs 229."

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Recommendation	BUY
Stock Price	Rs 195.7
Return since listing date*	75.28%
Profit Margin	48.21%
Q3 PE ratio	70.14
*Date of listing: Feb 23, 2007

All stock prices as on January 30, 2008. EPS is not annualised for computing PE ratio. Profit margins are based on nine-month consolidated results for 2007-8. Some financial jargon: YoY = Year on Year; QoQ = Quarter on Quarter; EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortisation.