Category: Companies

This analyst believes TCS will continue to outperform Infosys — Here’s why

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The growth story of India’s largest IT services company Tata Consultancy Services (TCS) shall continue the next year as well on the back of multiple triggers, according to stock broking company HDFC Securities.

Even as HDFC Securities’ IT sector research analyst Apurva Prasad remains selective of the IT sector and expects normalisation of growth rates over the next three to four quarters, he thinks there is still high growth visibility for TCS.

“The triggers are certainly around some of the mega deeds. The BSNL deal, for example, gives relatively high growth visibility for TCS for next year. At the same time, in the current environment, I think the company with its execution track record has a good chance of improving its margin. It has been outperforming on that front for the past few quarters,” he told CNBC-TV18 in an exclusive interaction on March 13.

From an execution standpoint, he said the current environment is such that deals are more cost-centric, there is cost optimisation and a lot more vendor consolidation, and there are captive takeover type deals — these support TCS, he asserted.

Also Read: CLSA says ‘sell’ these IT stocks — Here are the reasons for the cautious stance

Prasad added that the outperformance relative to Infosys would continue on growth the next year as well, and that is what his broking firm is building in.

His remarks come at a time when TCS shares have given a return of 17% in the past six months as compared to Infosys, which has risen a little over 7% during the period.

Other IT stocks that HDFC Securities is positive on are Persistent Systems and BirlaSoft as they continue to deliver well. Prasad explained that a good filter to have for mid-caps is companies that are on the top-end in terms of magnitude of growth, to where there is relatively high near-term growth visibility and some possibility of upside risk to estimates.

“Persistent Systems fits there. They could be potential big beneficiaries of generative AI getting bigger. At the same time, there is also margin upside case, so Persistent Systems and BirlaSoft are two companies within the mid-tier space that we continue to like,” he said.

He is also constructive on LTIMindtree and has given it an ‘add’ rating. It’s corrected a fair bit since the last quarter’s earnings, he said, adding that at ₹5,200 the risk-reward seems to be quite favourable, while it may not have near-term positive catalysts.

Also Read: UBS has upgraded this Tata group stock and raised target price to ₹4,700

Meanwhile, the brokerage has a ‘reduce’ rating on Wipro and Tech Mahindra as it believes the underperformance on growth and the margin catch-up is going to be tough as they need to get through industry averages and growth averages.

According to HDFC Securities, a large discretionary part in the current portfolio and a larger impact on BFSI than some of the peers are factors which would delay the recovery. On a relative basis, these stocks are expected to underperform and the ask becomes significantly higher at the current valuations.

On the other hand, the brokerage is of the view that Cyient is more attractive from a valuation standpoint but Tata Elxsi and L&T Technology Services (LTTS) valuation constraints are the factors why it is not constructive on these stocks.

Watch the accompanying video for more

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

TCS, LTIMindtree, HDFC Bank, Infosys, RIL and Bharti Airtel are buy recommendations for today

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Technical analysts Mitessh Thakkar of earningwaves.com and Sudarshan Sukhani, along with Rajesh Palviya, Vice President-Technical & Derivative Research at Axis Securities share their top stock picks for the day.

From Mitessh Thakkar

Mitessh Thakkar’s first buy call of the day is on Tata Consultancy Services (TCS). He recommends this with a stop loss of ₹4,145 for an upside target of ₹4,250. Shares have gained more than 1% in the last month.

He recommends a buy call on LTIMindtree with a stop loss of ₹5,165 for an upside target ₹5,300. The stock is down more than 5% over the last month.

Among the sell recommendations, Thakkar has one on Ashok Leyland with a stop loss of ₹171 for a downside target of ₹158. Shares have declined more than 3% over the last month.

Balrampur Chini Mills is another sell call from Mitessh Thakkar. His recommendation comes with a target of ₹345 and a stop loss of ₹371. The stock has declined more than 2% in the last month.

From Sudarshan Sukhani

Sukhani finds a buying opportunity in HDFC Bank. He advises traders to keep a stop loss of ₹1,430. Shares have gained more than 5% over the last month.

Sukhani’s only intraday short is on AU Small Finance Bank. For this, he advises a stop loss of ₹587. Shares are down more than 2% over the last month.

Infosys is another buy call from Sudarshan Sukhani. Stop loss is to be placed at ₹1,590. The stock has declined more than 3% in the last month.

Lastly, Sukhani recommends a buy on Reliance Industries Ltd (RIL). He advises a stop loss of ₹2,925. Shares have remained flat over the last month.

From Rajesh Palviya

Rajesh Palviya has a buy call on Balkrishna Industries with a stop loss of ₹2,325 and a price target of ₹2,400 on the upside. The stock was up more than 1% in the past month.

He also has a buy recommendation on Bharti Airtel with a stop loss of ₹1,185 for an upside target of ₹1,240-1,250. Shares are up more than 6% over the last month.

Additionally, he recommends selling Godrej Properties with a stop loss of ₹2,360 and a target of ₹2,280. Shares are up more than 1% over the last month.

Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

There are more women in Indian boardrooms now but not enough

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

In its fourth edition, the Excellence Enablers’ Survey on Corporate Governance sheds light on the evolving landscape of gender representation within corporate leadership.

While strides have been made, the report underscores persistent challenges and the need for concerted efforts to ensure equitable opportunities for women across all levels of the corporate hierarchy.

Also Read: India Inc disposed of nearly 1,000 POSH related cases in FY23 but…

The survey notes that while the presence of women independent directors (IDs) on boards has been mandated, a lack of similar provisions for the progression of women executives to board positions. It emphasises the need to identify competent women and provide them with appropriate career advancement opportunities within organisations.

Key findings from the survey include:

1. Increased proportion of women directors: Over the past five years, the proportion of women directors in the top 100 companies has risen from 19% to 26%, showcasing a notable upward trend in gender representation at the board level.
2. Rise in companies with multiple women independent directors: The number of companies with two or more women serving as independent directors has surged to 61 in March 2023, compared to just 20 five years ago, signifying a significant diversification of board compositions.
3. Growth in women holding managing director positions: The survey reveals a positive shift, with six companies appointing women as Managing Directors by March 2023, compared to merely three two years prior. 
4. Stagnation in women chairing companies: While there has been progress in several areas, the number of companies with women serving as Chairpersons has remained relatively unchanged, with only four companies reporting such appointments.
5. Increase in women independent directors: The number of women serving as independent directors has seen a significant uptick of 36% in the last five years. However, the survey also highlights a concerning trend, with a 13% decline in the number of women occupying roles that are not independent directorships.
6. Uptick in women holding key managerial positions: Encouragingly, the number of companies with women in key managerial positions, such as CxOs or positions one level below directors, has risen to 27 in 2023 from 19 in 2021.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tells Him to Walk Home from School, Runs Him Over with Her Car 2

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Sarai Rachel James, a resident of the US state of Alabama, mistakenly ran her car over her seven-year-old child after forcing him to walk home from school as a punishment. Police officials from the city of Boaz, Alabama said Sarai Rachel James picked her son up from the school on February 9 and heard from the principal that her child got into trouble earlier that day and decided to punish him to set an example going forward.

The mother stopped the car a short distance from the school and then told her son to walk home from there. The school and the house were eight blocks away from each other.

The boy initially started walking home but suddenly tried to grab the handle of the car door when the vehicle was moving. The mother suddenly accelerated the car, pulling her son under the car. He was run over with the back tire. The child was hospitalised with abrasions.

“It was a miracle he was not hurt worse than what he could have been,” Boaz police department chief Michael Abercrombie was quoted as saying by the AL.

However, the police and the investigators believe that Sarai Rachel James ran him over accidentally. Boaz police chief Michael Abercrombie did, however, point out that it was the punishment that led to the incident. “She may not have realised he was doing that,” he said.

Sarai Rachel James, 27, has been charged with aggravated child abuse in connection with the incident. She was released on $50,000 bond.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Legal Digest: Why a common description word can’t claim or violate trademark

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Case 1:  ‘Silk’ is a common description of paint hence no trademark violation

In Berger Paints India Limited v JSW Paints Private Limited, the Calcutta High court refused injunction against JSW’s Halo Silk trademark sought by Berger whose brand Berger Silk it contended was in the market for a very long time. 

To be sure, Berger Silk is a registered trademark but it can’t be dissected into Berger and Silk so as to deny usage of silk as described by a competitor.  Halo Silk didn’t cause confusion in the minds of lay buyers by being deceptively similar to Berger Silk. 

It is now a settled law that words occurring in dictionaries as well as in common usage are not eligible for trademark protection.  Silk, matt, gloss and satin are the most common adjectives used by paint manufacturers and no one can claim exclusivity to such descriptions, ruled the Court.

Case 2: Sexual perversions forced on a spouse amounts to cruelty and ground for divorce 

The Kerala High Court recently in X vs Y (true names hidden) matter held that sexual perversions practised with mutual consent is the private affair of the couple but the one forced upon by husband on wife or the other way round amounts to cruelty entitling the spouse to divorce on grounds of cruelty. 

Cruelty hitherto has been interpreted to include mental torture as well but this judgement must be hailed as breaking a new ground.  Oral sex may be kosher but if it is revolting to one of the marital partners, the other spouse cannot impose his will on her or vice versa. And if he or she does, the spouse is entitled to divorce on the grounds of cruelty.

Case 3: TCS on liquor bottles not mandated by law

In the Tamil Nadu State Marketing Corporation Ltd (TASMAC) vs Deputy Commissioner of Income Tax (DCIT) — the issue before the Madras High Court was whether TASMAC was derelict in not collecting tax at source as per section 206C of the Income tax Act on amount realised from the sale of empty bottles were concerned—the Madras High Court agreed with the appellant’s contention that it did not sell bottles but merely liquor.

Section 206C was introduced to prevent tax evasion by the hard-to-tax segment of any business. Liquor has always been perceived to belong to this genre which is why section 206C roped it in together with the presumptive taxation scheme obtaining for kit. 

TASMAC performed its duty by collecting 1% tax from the supply of liquor to the successful bidders in the auction but was hauled over coals for being derelict in not collecting tax on the sale of empty bottles.  The Madras High Court agreed with the appellant’s contention that it did not sell bottles but merely liquor.  It did not furthermore own the bottles.  It was thus absolved of the responsibility to collect tax at source on bottles even under the artificially elongated definition of scrap.  

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Paytm Q3 results: Revenue rises 38%, net loss narrows to ₹220 crore

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Paytm reported a 38% year-on-year (YoY) increase in revenue for the third quarter of the financial year 2024 to ₹2,850 crore on Friday, January 19. The company — which has not posted a net profit since it went public in November 2021 — said its consolidated net loss narrowed to ₹220 crore from ₹392 crore a year ago.

The company’s EBITDA or earnings before interest, taxes, depreciation, and amortisation before employee stock option (ESOP) grew to ₹219 crore, marking an uplift of ₹188 crore YoY.

Paytm’s profit after tax (PAT) experienced an increase by ₹170 crore YoY to reach ₹222 crore in Q3. The payments business segment recorded 45% YoY growth in revenue, soaring to ₹1,730 crore in Q3FY24.

Paytm’s financial services and other revenue climbed by 36% YoY, reaching ₹607 crore in Q3. On the other hand, the marketing services revenue demonstrated 22% YoY growth, totalling ₹514 crore in Q3.

The net payment margin witnessed a growth of 63% YoY to ₹748 crore in Q3.

Paytm’s contribution profit experienced 45% YoY growth, reaching ₹1,520 crore in Q3. The number of Paytm merchants paying a subscription for payment devices surged to 1.06 crore, marking a 49 lakh YoY increase.

The total loan disbursal value recorded a 56% YoY surge, reaching ₹15,535 crore in Q3FY24.

Paytm’s Average Monthly Transacting Users witnessed an 18% YoY increase, reaching 10 crore in Q3. The gross merchandise value experienced a 47% YoY surge, reaching ₹5.10 lakh crore in Q3.

The cash balance improved to ₹8,901 crore in the third quarter of FY24, up from ₹8,754 crore in Q2FY24.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Reliance Jio Q3 result: Profit rises 3% to ₹5,208 crore, revenue at ₹25,368 crore in Dec quarter

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Reliance Industries telecom division Reliance Jio Infocomm saw a sequential profit growth of 3% at ₹5,208 crore for the October to December 2023 quarter, according to the company’s financial results released on January 19. This is slightly higher than the CNBC-TV18 poll profit projection of ₹5,150 crore. The firm registered a profit of ₹5,058 crore in the July to September 2023 quarter.

The telecom company’s revenue rose to ₹25,368 crore for the third quarter of the financial year, as compared to ₹24,750 crore in the preceding quarter. The revenue is largely in line with the poll estimate of ₹25,360 crore.

Jio’s operational performance has improved as its earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose to ₹13,277 crore for the quarter under review from ₹12,953 crore in the last quarter. The EBITDA has come in a little lower than the poll forecast of ₹ 13,450 crore.

The margin, meanwhile, was flat at 52.3%.

Jio’s subscribers’ data is yet to be released and it must be noted that analysts polled by CNBC-TV18 had suggested that the telco’s revenue growth would be driven by a 10 million subscriber addition and a moderate increase in average revenue per user (ARPU).

In the July to September quarter, the company had a total subscriber base of 459.7 million; the company had added 11.2 million subscribers (net), as against 9.2 million in the first quarter of the financial year. The ARPU had come in at ₹181.70 in the September quarter, up from ₹180.50 reported in the April-June quarter.

The data released by the Telecom Regulatory Authority of India (TRAI) for October 2023 showed Jio added 3.1 million subscribers during the month. Following this, the CNBC-TV18 poll of analysts expects the firm will have expanded its subscriber base by 10 million during the third quarter of 2023-24.

Among the other factors, analysts expect the Street to track 5G rollout and adoption. As of the second quarter, Jio’s 5G data traffic accounted for more than 15% of overall data traffic. The rollout of Jio AirFibre and the hike in 4G prepaid tariff will also be key to watch, analysts said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow