Stock Recommendations For Your Portfolio

CMC | BSE CODE - 517326  | Volume - 36000 | CMP - Rs 1690 | Face Value - Rs 10

CMC, a subsidiary of TCS, is witnessing strong recovery in its key markets, viz. US and Europe. With a pick-up in spending in the European region, the company’s two key verticals, i.e. Systems Integration and ITES, could witness improvement in the demand environment going forward. This would be a positive trigger for the company. The management has stated that investments in product development and asset-based solutions (ABS) will act as key future growth drivers. ABS contributes 28 per cent to revenue, and the company intends to take this upto 40-42 per cent over the next two-three years. It has also logged a robust performance in Q2FY14, and this is likely to be repeated in its Q3FY14 results. Being a subsidiary, its parent TCS provides the company with all the advantages of a large player to execute bigger projects. Investors can look at the stock from a medium-term perspective.

SUN PHARMACEUTICAL INDS | BSE CODE - 524715 | Volume 147000 | CMP - Rs 594 | Face Value - Rs 1

With pricing power in certain products, Sun Pharma is likely to witness better revenue and realisations in the US markets going forward. Also contributing to this will be its Israel-based subsidiary, Taro Pharmaceuticals. Taro’s net profit stood at USD 96 million, a jump of 47 per cent on a YoY basis. This was mainly due to the shortage in supply of Doxil, an injectable drug used to treat ovarian cancer multiple myeloma from the innovator Johnson & Johnson, which has given Taro the status of sole supplier of the drug. Apart from this, Sun Pharma’s management had revised the company’s revenue growth guidance in FY13 to 25 per cent from 18-20 per cent mentioned earlier. The company is also going to enjoy 180-day exclusivity on its launch generic Prandin, an anti-diabetic medication, post the US FDA’s approval for the same. One can look at the stock from a medium-term perspective.