Research Calls

Visualsoft Technologies

Recommendation: buy at Rs 184

Batlivala & Karani Securities

Batlivala & Karani Securities is bullish on Visualsoft Technologies at Rs 184. The expertise built in the insurance domain has enabled the company to show impressive growth of 64 per cent in IT services revenues.

It has been able to scale up the business from existing clients as well as acquired two new insurance companies as its customers recently. This apart, the company plans to leverage its existing relationships in the proposed BPO business. The scrip is trading at 11.5x and 9.6x its FY03 and FY04 earnings respectively.

Pharma stocks

Recommendation: overweight

Ask-Raymond James Securities

In an update, Ask-Raymond James examined the result expectations of seven large pharmaceutical companies, five Indian and two subsidiaries of multinationals, and continues to remain bullish on the sector.

It believes that the overall performance of pharma companies will be mixed, largely dominated by overseas operations (up 29.3 per cent) and by business restructuring.

In case of Indian companies, the performance in the home market could remain subdued and are estimated to grow at 11.9 per cent. Moreover, the growth in the Indian pharma companies could be lumpy and unpredictable.

Zee Telefilms

Recommendation: buy at Rs 89

Inquire Indian Research

Inquire Indian Research has maintained its buy recommendation on Zee Telefilms at Rs 89. The brokerage house is bullish about the company's new programming strategy that could substantially improve the viewership of its mainstream general entertainment channel.

This time around, Zee proposes to take on the competition by broadcasting relatively new block buster movies on a week day (Thursday) to attract viewers.

While its daily prime time serials will be broadcasted from Sunday to Wednesday, in contrast to usual strategy of airing expensive content like movies on week-ends. The scrip is trading at 13.2 times its FY03 (Rs 6.7) earnings.

FMCG stocks

Recommendation: neutral

Morgan Stanley Securities

In a recent update, Morgan Stanley has identified Nestle India at Rs 564 as one of the best picks in the fast moving consumer goods (FMCG) sector. Sluggish demand growth and intense competition continue to bog down the sector.

In fact, Indian consumer sector retail value growth has slipped to -1.6 per cent in August 2002 after showing signs of recovery in the previous two months (+0.7 per cent in July 2002 and +0.2 per cent in June 2002). The brokerage house, however, expects slow and gradual recovery in the demand growth in second half of this fiscal.

Padmalaya Telefilms

Recommendation: buy at Rs 90

Falcon Brokerage

The brokerage house has recommended a buy on Padmalaya Telefilms at Rs 90, with a 12-month price target of Rs 160. The diversified revenue model encompassing films, television software, animation, film distribution and film infrastructure helps Padmalaya broad base the risk of the volatility of individual revenue streams. The scrip currently trades at 4x its FY03 earnings.