RS 800 up trend in infosys and Rail

Infosys Technologies

Reco: ACCUMULATE

CMP: Rs3,080

Target Price: Rs3,300

Solid show marred by muted earnings outlook

· Revenues at US$ 1,496 mn (+10.2% QoQ) beat high expectations. Op mgns expanded by ~170 bps QoQ to 33.3% (V/s exp of ~190 bps increase)

· Co wide vol growth at 7.1% QoQ (onsite vols up by ~15% QoQ) Broad based growth across verticals/service lines with Europe joining the party with a ~16% QoQ growth

· FY11 Revenue guidance raised to ~24-25% YoY growth now, however EPS raise muted and a tad disappointing at Rs115-117 ( V/s Rs112-117 earlier)

· Marginal change in FY11/12E EPS despite higher currency reset helped by ~2.4%/6% increase in revenues. Retain ACCUMULATE with a March’12 TP of Rs3,300



Rallis India

Reco: BUY

CMP: Rs1,416

Target Price: Rs1,800

Price target revised to Rs 1,800

· Q2FY11 results were broadly in line with estimates with EBITDA margins of 24% and PAT growth of 23% to Rs 587 mn

· Revenues, +15% yoy, were below estimates due to floods in northern region - expected to catch up in the coming quarters

· Outlook for H2FY11 remains encouraging with estimated APAT growth of 44% based on strong domestic outlook

· With strong visibility, we rollover our price target to FY13E and revise price target to Rs 1,800 (from Rs 1,440) and maintain BUY