Friday, June 18, 2010

KPIT - Strong buy CMP Rs 132

KPIT (Rs 132)
  • KPIT Cummins provides technology solutions to global clients in the areas of Advanced Technology Solutions, Enterprise IT and Business / Knowledge. So far the company has made seven acquisitions since 2002, most recent being Sparta last year.
  • KPIT is dealing in following verticals - Auto Electronics, Semiconductor Solutions, Business Intelligence, Global Business Solutions, Manufacturing and Diversified Financial Services. KPIT developed AUTOSAR 2.0 complaint tools used by leading Tier-1 company to develop system level components for car manufacturers.
  • KPIT focused on three verticals - automotive, industrial and high-tech, these sectors got badly affected by the downturn and now we already see Auto industry reviving very well along with other sectors.
  • The company is looking at Government and Defense contracts which would result in the company foraying into the domestic space.
  • Recently the stock is in a firm up trend after announcement of Joint Venture with BHARAT FORGE for innovative solutions belonging to next generation of automotive technology.
The stock trading at Rs 132 looks very good long term investment and investors can accumulate this stock in dips. It is near a major breakout and once Rs 145 is crossed next rally would be very smooth; 12-15 month investment target can be Rs 190-200 for the stock.
In short-term one can buy around current levels for target Rs 155-160, stops below Rs 128 for short-term traders only.

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