Anand Rathi Securities: Sell InfoTech, aim of Rs 175

Infotech-EnterprisesAnand Rathi Securities seems to be bearish on InfoTech Enterprises and has suggested a sell rating on the stock with a goal of Rs 175 in its October 14, 2010 research report.

InfoTech Enterprises EBITDA profits decreased 50bp qoq on report of wage hikes (subsequent to a 557-bp qoq fall in 1Q) as even along with healthy 15.8% volumes for the UTG (6.4% organic) and 13.2% for the EMI verticals.

Organization signifies that employing a high-cost sales team shall be holding margins in check.

They uphold there target price and rating on the stock. US dollar income increased by 14.6% qoq (11.3% organically). The corporation further added 7 customers in the UTG and 5 in the EMI vertical.

Naturally, North America elevated 23.2%, whereas Europe grew 14.3%. InfoTech takes in Rs 3.6 billion (Rs 33 per share) in cash and cash counterparts.

They put down their FY11e and FY12e EPS 3.8% and 3.5% to Rs 12.5 and Rs 15.4 correspondingly, keeping into account the less profit. They anticipate about 16% volume growth, flat pricing, and a 40-bp margin growth over FY12, a tax rate of 23% (constant contrast with FY12).