Monthly Recommendations

Paradyne Infotech Ltd.
(Rs 92, FY08E - P/E 4x, BUY, Target Price Rs 150, Earlier
recommended at Rs 68)
PIL has come a long way to capture the booming Indian IT sector, with a modest beginning as a System Integrator to a provider of varied range of services and offering.
PIL has chalked out a well-defined path for growth, which comprises of both the organic and inorganic initiatives to garner the incremental IT spending in both the domestic and global market, and PIL’s recent acquisitions of LGI is synergetic to leverage the latter’s global presence and derisk the geographical risk.

Tata Elxsi Ltd.
(Rs 274, FY08E - P/E 11x, BUY, Target Price Rs 368, Earlier
recommended at Rs 242)
Riding on strong fundamentals:
Tata Elxsi continues to show strong financials and operational performance, with incremental clients accounts ramp up and increasing value added services in the portfolio. For the Q3FY07, TEL has demonstrated a strong set of number, with
impressive margin expansion, which reflected in 17% QoQ growth and 83% in net profit to Rs 139 mn, which was the highest growth achieved by the company in the last ten sequential quarter.

Ratnamani Metals & Tubes Limited
(Rs. 652, FY08E - P/E 6x, BUY with a revised Target Price of Rs.
944) (Initially Recommended at Rs. 358 on 19th Sept. 2006)
The RMTL stock currently trades at 9x FY07E and 6x FY08E which we believe is attractive. We had recommended a BUY on 19th September 2006 at Rs385 and from there the stock has moved up by 55%. We continue to remain positive on the stock and believe RMTL stock still has good potential upside from this level and so we maintain a positive bias on the RMTL stock and re-iterate a BUY with revised target price of Rs 944 based on DCF approach, which will give an upside of 58% from current level. At our target price the stock would trade at a P/E multiple of 9x on FY08E earnings.