Buy CMC; target of Rs 1690: Firstcall Research

Firstcall Research report on CMC

"CMC posted consolidated Operating revenue of Rs. 5609.29 million in quarter ending December 31, 2013, which represents growth of 14 percent. The company earned profit after tax of Rs. 705.43 million, representing growth of 16 percent y-o-y. On a cumulative basis the Company earned operating revenue of Rs. 16077.2 million in the first 9 months of current financial year, resulting in growth of 15 percent over corresponding period last year. During the period, the Company's International business growth was 13 percent y-o-y."

"The Company has registered excellent growth in the international markets and continues to find very good traction among its clients across geographies and added 14 clients during the quarter. The Company continues to focus on people excellence and was assessed at PCMM level 5 by SEI during the quarter."

"The Company had set up a SEZ Unit in Kolkata to cater the demand of international client and provide them business continuity solution. The project is likely to be completed by March 2015. On completion, this facility will have capacity of around 2000 seats. Over FY2012-15E, we expect the company to post a CAGR of 18 percent and 23 percent in its top-line and bottom-line respectively. Hence, we recommend 'BUY' on the stock with a target price of Rs 1690," says Firstcall Research Report.

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