Prabhudas Lilladher has mainatained its buy rating on Reliance Communications with a target price of Rs 706 in its May 14, 2008 research report. "Rcom has guided for a potential market size of USD 275 billion for its global assets, which will be offering a diverse portfolio of global communication business services, including global voice, managed network, carrier ethernet and fibre capacity businesses. Total investments in Reliance Globalcom stands at USD 2.75 billion at the end of FY08. Reliance Infratel aims to increase its tower portfolio to 70,000, thus enabling it to have 280,000 slots by FY10."

"With favourable regulatory developments in the last couple of quarters, we believe Rcom is in a sweet spot. At the CMP of Rs 559, the stock trades at a PER of 14.2x and at an EV/EBITDA of 9.8x FY10E earnings. Unlocking value in Reliance Globalcom and Reliance Infratel could be key catalysts in the next 6-12 months. Maintain BUY," says Lilladher's research report.

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