| 1.21 |
58 |
2,370 |
| Patni Computer #* | 237 | 325 | 14th April 2008 | 6th February 2009 | 0.00 | 1,276 | 3,400 |
| Madras Cement^ | 64 | 4,200 | 29th Feb, 2008 | Closed | 1.02 | 145 | 3,877 |
| GTL* | 259 | 300 | 29th October 2007 | Closed | 0.76 | 1,348 | 2,642 |
| Aurobindo Pharma | - | - | Proposed | - | 2.35 | 583 | 1,652 |
| Mastek *$ | 65 | 750 | Approved | - | 0.00 | 151 | 921 |
^ Buyback offer was initially expected to close on 30-January-2009
* consolidated, # Calendar year(2007), $ June ending
Total debt to equity, cash & investments are FY07 numbers Source: BSE/ Capitaline |
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ICI India
The share price of ICI India jumped over 20 per cent between March 24 and 31, thanks to the company's decision to sell its adhesive business. ICI India is now a 53.88 per cent subsidiary of Akzo Nobel, following the latter's takeover of UK-based parent ICI plc this January.
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| As a part of the strategy, its new parent (Akzo Nobel) wants to ramp up ICI's paint business and divest other businesses, which led to the sale of the global adhesive and the electronic material businesses of ICI plc to Henkel for 2.7 billion pounds.
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| As a result, ICI India's adhesives business is also being sold to an Indian affiliate of the Henkel Group, for about Rs 260 crore and the process is expected to be completed by December 2008.
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| This, along with the sale of its various non-core businesses in the past, is expected to balloon its investment kitty to over Rs 1,000 crore (Rs 275 per share)-almost equivalent to 50 per cent of its current market capitalisation.
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| Going forward, ICI India is expected to benefit from the good prospects for the paint industry, greater synergies following concerted efforts of Akzo Nobel in growing ICI India's business, access to a wider portfolio of products of its new parent, its increased focus on premium products and a huge pile of cash (roughly about Rs 880 crore even after the buyback), which can be used for organic and inorganic growth opportunities.
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Notably, the paints business enjoys a healthy return on capital employed of over 20 per cent. The stock trades at about 18 times its estimated price to earnings (excluding cash) multiple for FY09. Long-term investors should hold on to the stock and prospective investors may accumulate the stock on declines.
| ROBUST FUTURE | | Rs crore | Net sales | Net profit | EPS (Rs) | P/E (x)
FY09E | | FY09E | CAGR (%) | FY09E | CAGR (%) | FY09E | CAGR (%) | | Reliance Energy | 7,237 | 12.6 | 1,108 | 17.6 | 47.4 | 13.2 | 24.8 | | Hindustan Unilever# * | 17,791 | 13.1 | 2,408 | 12.1 | 10.7 | 11.5 | 22.8 | | ICI India* | 1,027 | 0.7 | 118 | 19.0 | 31.6 | 21.5 | 18.1 | | Great Offshore* | 875 | 22.7 | 240 | 28.4 | 56.0 | 21.4 | 11.1 | | Patni Computer*# | 3,374 | 12.0 | 461 | -2.4 | 32.0 | -4.4 | 7.7 | | Madras Cement | 2,802 | 33.4 | 610 | 40.7 | 505.5 | 40.8 | 6.3 | | GTL* | 2,233 | 55.3 | 204 | 74.0 | 21.0 | 74.5 | 12.4 | | Aurobindo Pharma | 3,144 | 21.7 | 299 | 21.9 | 37.0 | -1.3 | 8.3 | | Mastek*$ | 1,038 | 14.3 | 133 | 11.6 | 46.5 | 20.5 | 6.9 | | * consolidated ,# Calendar year (2007), $ June ending, CAGR: between FY07-FY09E, Source: Analysts Reports |
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Mastek
The Mastek board had approved the buyback of the company's shares worth Rs 65 crore at a price not exceeding Rs 750 per share in October 2007.
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| While there is no update on the buyback offer, the stock has largely moved in line with the BSE Sensex and has also outperformed the BSE IT index since the announcement.
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| Mastek, a software solutions and integration services provider, is among the top-20 IT software and service exporters from India.
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The company provides enterprise solutions to insurance, government, and financial services organisations worldwide. Mastek has a differentiated position in its insurance practice with its well-adopted solution framework
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