The four-year-old
Daksh e-services is one of the better bets in the BPO space. Not
only has it grown its revenues (to an expected Rs 145-170 crore
for 2002-03) at a break-neck pace, but it has also protected its
profit margins and expanded service range. The reason for that,
according to Daksh's CEO Sanjeev Aggarwal, is a careful management
of the investment-growth equation. From an investor's point of view,
Daksh has several things going for it. One, it's the only independent
BPO company looking at a listing. Two, the it-enabled services industry,
currently clocking $1.5 billion (Rs 72,000 crore), is projected
to touch $20 billion (Rs 96,000 crore) by 2008. And finally, Daksh
has major scalable customers such as Amazon and Yahoo!
Biocon: Biotech's Big
B
It was India's
first biotech company, boasts of global leadership (a 25 per cent
share) in select industrial enzymes such as Pectinases, Tea Tannases,
is profit-making and has ambitions of being one of world's top 10
biopharmaceuticals companies by 2010. You don't need more reasons
to buy into biotech's first IPO. Says Kiran Mazumdar Shaw, Chairperson
and Managing Director, Biocon Group: "In the next three years,
we will be one of the largest human insulin and statin producers
in the world." To do that, Biocon plans to raise Rs 150-200
crore shortly. Simultaneously, it is exploiting opportunities in
contract research. In fact, the success or failure of Biocon may
well determine the future of India's biotech industry.
LG Electronics: Korean Samurai
LG is the market
leader in CTVs, air-conditioners, fully automatic washing machines,
and microwave ovens. Never mind that like its compatriot Samsung,
it entered the market less than seven years ago. What explains the
quick rise to the top? Deep pockets, state-of-the-art technology,
and aggressive marketing. Therefore, while in 1998 LG's sales were
mere Rs 465 crore, in 2002 calendar it is expected to have racked
up Rs 2,700 crore in topline. LG, which employs strategies similar
if not identical to Samsung's, has products across the price range,
from Rs 8,000-ctvs to Rs 1 lakh-plus plasma projection CTVs. It
has clearly positioned itself on the health platform, and relentlessly
advertises through the year. Compared to some other players in the
durables business, LG is on a strong wicket.
Maruti Udyog: Betting
On Suzuki
This is an initial
public offer that should have happened by now, except for the fact
that majority stake holder Suzuki and partner the Government of
India have been at loggerheads. The latter wants Suzuki to underwrite
the 36 lakh shares at Rs 2,300 apiece, while the Japanese partner
doesn't see much sense in that, given that it already has a majority
stake in Maruti Udyog. The face value of Rs 100 is likely to be
divided into 10 or more units to enable small investors to participate
in the issue. If that happens, investors will almost certainly bite.
Reason? It is essentially a bet on Suzuki-that the small car maker
will somehow manage to maintain its leadership, and leverage that
to keep costs under control and hence protect profits. When is the
IPO expected? Most likely in March this year.
TCS: Top Pic
TCS is the gold
standard of the information technology industry. It's not only the
oldest and the biggest of the IT services companies, but it enjoys
tremendous brand equity in international markets. And it's a money-making
machine that churned out an estimated Rs 1,300 crore in net profits
last year on a turnover of Rs 4,187 crore last year. Dalal Street
analysts estimate that the company would be valued at Rs 60,000
crore, and probably raise just 10 per cent of that in its IPO. What
about TCS' future growth? It could be explosive. TCS is the only
company in research firm Gartner's top 25 list of software maintenance
and support firms. Better still, it is the second-fastest growing
of them. Pricing, however, will be an issue, since it stocks are
already trading at high PES.
Jyothi Laboratories:
Silent Winner
Last year, when
baring private equity partners wanted to exit Jyothi, it didn't
have to sweat to find a buyer. CDC Advisor Partners and Credit Lyonnais
snapped up the stake for a cool $8 million (Rs 38.4 crore). Baring's
initial investment? Just $3.5 million (Rs 16.8 crore). Deals don't
get much better than that. Why is Jyothi hot property? It's a conservative
fast moving consumer goods company that plays its cards rather well.
Be it humbling Reckitt-Benckiser's Robin Blue with its Ujala, which
now has three-fourths the Rs 200-crore market, or launching Maxo,
a mosquito repellent, purely on the strength of outsourcing and
making it a success. The company's long-term plan is to be a comprehensive
FMCG player. It has already forayed into the washing bar market
with Exo. Led by a low-profile, accountant-turned-entrepreneur promoter
M.P. Ramachandran, Jyothi's austere business model makes it a strong
long-term bet.
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