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Tata Consultancy: Better than expected pricing could provide further upside [Aniruddha Bhosale]
Mr. Chandrasekaran -CEO TCS, mentioned in an interview on television that they should ‘definitely see a pricing uptick during the next fiscal year across the board’. For the first time since the recent downturn, has the senior management of any Indian IT services company admitted to broad based price increase. This along with the fact that discretionary IT services spend by customers is on the rise, augurs well for FY12E revenue and earnings outlook of the company in particular and the sector in general. We expect the company to report a revenue growth of 30%yoy for FY12E. With a potential upside to our and consensus price increase assumption of ~2.5%yoy in FY12E, we believe there could be further earnings upgrades through the year.
Pantaloon Retail India Ltd: Pantaloon restructuring: Still WIP [Harrish Zaveri]
Future captal holdings (FCH) (a 54% subsidiary of pantaloon) is slated to increase its loan book to INR 30 bn by June 2011. This would imply loans and advances amounting to 30-35% of Pantaloons consolidated FY11 balance sheet. This would imply continued pressure of relatively higher debt and consequently higher interest cost in FY11. The restructuring of Pantaloon's financial, real estate, insurance, telecom and media subsidiaries is still a work in progress and will likely be completed in 18-24 months. Pantaloon's interest cost for the first 6 months is INR 2431mn and our estimates factor in an interest cost of INR 5222mn for the full year FY11. We maintain our net earning estimate of INR 1.76 bn (13% below consensus) and INR 2.37 bn for FY12E (20% below consensus).
The Investigator: Absolute resilience, relative concerns [Ajay Kapur]
We reiterate our bullish views on Asian markets in absolute terms. 1) Valuations are at fair levels versus history, and relative to excess returns on equity. 2) Leading indicators for the US are exceptional in their strength and breadth, although some Asian leading indicators are signaling a near-term soft patch for EPS growth. 3) Technicals for global equities are strong considering the scale of the natural disaster in Japan, the scope of turmoil in the Middle East, and re-emerging European sovereign debt issues. 4) Global central banks are accommodating, despite their shifting rhetoric. The PBoC could turn less tight.
US Daily Economic Notes: Tax receipts point to healthy income gains [Joseph LaVorgna]
We have highlighted withheld income tax receipts in the past as a useful tool to gauge the health of income growth in real-time. Individual income tax receipts are reported daily by the US Treasury and are not subject to revision, the drawback is that they are volatile on a day-to-day basis, which necessitates a significant statistical smoothing. As of the latest data point, income tax receipts are up 4.4% year-on-year, consistent with the rising trend in wage and salary growth which was up roughly 4% in February.
Commodities Quarterly: Market Update [Michael Lewis]
According to latest data from the CFTC, investor flows into commodities are now at a new all time high. We expect this trend to continue as investors attempt to exploit strong EM growth, the risks of higher inflation ahead and as a hedge against tail events.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Tata Consultancy: Better than expected pricing could provide further upside [Aniruddha Bhosale]
Mr. Chandrasekaran -CEO TCS, mentioned in an interview on television that they should ‘definitely see a pricing uptick during the next fiscal year across the board’. For the first time since the recent downturn, has the senior management of any Indian IT services company admitted to broad based price increase. This along with the fact that discretionary IT services spend by customers is on the rise, augurs well for FY12E revenue and earnings outlook of the company in particular and the sector in general. We expect the company to report a revenue growth of 30%yoy for FY12E. With a potential upside to our and consensus price increase assumption of ~2.5%yoy in FY12E, we believe there could be further earnings upgrades through the year.
Pantaloon Retail India Ltd: Pantaloon restructuring: Still WIP [Harrish Zaveri]
Future captal holdings (FCH) (a 54% subsidiary of pantaloon) is slated to increase its loan book to INR 30 bn by June 2011. This would imply loans and advances amounting to 30-35% of Pantaloons consolidated FY11 balance sheet. This would imply continued pressure of relatively higher debt and consequently higher interest cost in FY11. The restructuring of Pantaloon's financial, real estate, insurance, telecom and media subsidiaries is still a work in progress and will likely be completed in 18-24 months. Pantaloon's interest cost for the first 6 months is INR 2431mn and our estimates factor in an interest cost of INR 5222mn for the full year FY11. We maintain our net earning estimate of INR 1.76 bn (13% below consensus) and INR 2.37 bn for FY12E (20% below consensus).
The Investigator: Absolute resilience, relative concerns [Ajay Kapur]
We reiterate our bullish views on Asian markets in absolute terms. 1) Valuations are at fair levels versus history, and relative to excess returns on equity. 2) Leading indicators for the US are exceptional in their strength and breadth, although some Asian leading indicators are signaling a near-term soft patch for EPS growth. 3) Technicals for global equities are strong considering the scale of the natural disaster in Japan, the scope of turmoil in the Middle East, and re-emerging European sovereign debt issues. 4) Global central banks are accommodating, despite their shifting rhetoric. The PBoC could turn less tight.
US Daily Economic Notes: Tax receipts point to healthy income gains [Joseph LaVorgna]
We have highlighted withheld income tax receipts in the past as a useful tool to gauge the health of income growth in real-time. Individual income tax receipts are reported daily by the US Treasury and are not subject to revision, the drawback is that they are volatile on a day-to-day basis, which necessitates a significant statistical smoothing. As of the latest data point, income tax receipts are up 4.4% year-on-year, consistent with the rising trend in wage and salary growth which was up roughly 4% in February.
Commodities Quarterly: Market Update [Michael Lewis]
According to latest data from the CFTC, investor flows into commodities are now at a new all time high. We expect this trend to continue as investors attempt to exploit strong EM growth, the risks of higher inflation ahead and as a hedge against tail events.
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