Angel Broking's research report
"HCL Tech has recorded a ~3.4 percent CQGR in its revenue over the past eight quarters. This is primarily on the back of Infrastructure Management Services growing substantially higher than the company's average growth rate. The Management noted that growth in revenue from software services will pick up when the respective component in the large deals won recently ramps up. We believe that sustaining the run-rate of large deal wins is a healthy sign and should translate into better revenue visibility for the company in FY2015. We expect HCL Tech to post a USD and INR revenue CAGR of 12.7 percent and 12.1 percent, respectively, over FY2014–16E and remain watchful of the company's performance in the core software services. On the operating front, we remain skeptic on the company's ability to sustain operating margins at current levels with it going for hiring (with increase in demand) and wage hikes going ahead as attrition continues to remain sticky. We value the company at 14.5x FY2016E EPS and give it a target price of Rs 1,560. We recommend an Accumulate rating on the stock."
Reliance Industries (RIL)
"For 4QFY2014, RIL's Petrochemicals and Refining segments' profit reported improvement; however, its Oil & Gas segment's profitability continued to decline on a yoy basis due to decline in production from its KG D6 block. Looking ahead, we expect production from the KG D6 block to increase gradually from FY2015. Moreover, higher gas prices and the recent improvement in GRMs are likely to drive earnings growth in FY2015-16. Hence, we recommend an Accumulate rating on the stock with a target price of Rs 1,042", says Angel Broking research report.
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