Tag: Asia

Geojit Financial Services is bullish on Blue Dart, Abbott India

Posted by | Feb 25, 2008 | |

Blue Dart is an 81pct subsidiary of the DHL Group, Shah said. “The company has posted excellent December quarter results. It plans to compliment and widen service offerings. It has launched a new surface express product in CY07 called Dart Surfline, which is expected to grow 40-45pct per annum.”

Abbott India is a 65pct subsidiary of Abbott Inc USA, he said. “The company’s numbers are in line with expectation. It provides healthcare services through business units. The parent company Abbott Inc is a leading player globally and is focused on pharma.”
Q: What makes you so bullish on Blue Dart? Is it the sector as a whole or the fact that they had a stellar set of December numbers?

A: It is basically the sector considering the kind of growth potential. If you consider the number of MNC plans that are coming into India, logistics business is supposed to grow going forward from hereon. Considering the capex cycle that corporate India has, the entire sector in logistics looks quite good, whether it is Blue Dart or certain other reasonably low-end players.

Blue Dart is a 81pct subsidiary of DHL and is one of South Asia’s most integrated courier and logistics company. It also has the benefit of covering 220 countries, considering it is an 81pct subsidiary of DHL. Also, the distribution service spectrum is about to witness a fair amount of growth from hereon.

Blue Dart has been in the domestic market for a very long time and also has the expertise to deliver. Considering that companies like Tesco, Wal*Mart and Carrefour are opening their retail outlets in India, the services provided by Blue Dart would definitely tend to grow, keeping in mind the kind of retail boom we are seeing.

We have a price target of Rs 750 on Blue Dart over a one-year timeframe. Possibly, if you have a stretched out timeframe, it can even get better from hereon.

Abbott India is a 65pct subsidiary of Abbott Inc. USA. Abbott India provides healthcare solutions to its three segments – primary care, specialty care and hospitality care. The parent company Abbott Inc has got good number of products in its pipeline and is well poised to take advantage of the patent when it unfolds in India.

Considering the kind of growth that the healthcare business can possibly see in India, I think the topline and bottomline would definitely benefit. Abbott could possibly well be poised to leverage the parent company’s product line-up. We have a price target of about Rs 630 with a one-year timeframe.

Q: The volumes on both these stocks are dismally low. How would you explain the kind of price rise or interest in the counters on such low volumes?

A: With Abbott especially, it has traded only on BSE. In case you are a one-year plus kind of an investor, then these kinds of volumes should not make much of a difference, because you are not taking a trading call over here. The volumes are definitely low on both Abbott as well as Blue Dart. But if you have a delivery perspective and a one-year timeframe, then these kinds of low volumes should not deter you from making an investment.

Of course, the sectors that both these companies are placed in, tends to grow from hereon, on the domestic consumption growth story. So, considering these two points, volumes should not deter you from making an investment call on these two companies.

Q: Any disclosures?

A: No personal holdings. But since our company has got a buy report on both, our clients might be holding their positions in the two companies

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Global cargo firms keen to fly into India

Posted by | Feb 24, 2008 | |

The air cargo industry in India is all set to expand its wings. According to ministry of civil aviation, three international companies — FedEx, Malaysia Airlines (MAS) and Australia-based HeavyLift Cargo Airlines — have approached the ministry seeking details on setting up and expanding their operations in India.

The three freighter service providers have sought clarification on the recent Cabinet decision to increase the foreign direct investment (FDI) cap from 49 pct to 74 pct in the air cargo sector.

According to ministry sources, MAS plans to start a dedicated freighter service between Kuala Lumpur and Delhi this year and is also considering using Delhi as its cargo transit point from Amsterdam and Frankfurt. At present, MAS has no dedicated freighter services to India.

A World Air Cargo report says India is the leading international freight market in the sub-continent. Out of the total 1.4 million tonnes of international cargo that flew in and out of the region, India moved the maximum with 8.82 lakh tonnes. Kuljeet Singh, partner, Ernst and Young, feels there is a lot of scope for cargo airlines in India.

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China Postal Airlines launches flights between Yantai, Seoul

Posted by | Feb 21, 2008 | |

Mail and cargo flights between the Chinese coastal city of Yantai, Shandong Province, and Seoul, Republic of Korea, went into operation, shortening delivery times between the two cities by at least 12 hours.

A Boeing 737 aircraft of China Postal Airlines, specializing in express mail services (EMS) and cargo transport, took off from Yantai International Airport at 11 a.m. and landed in Seoul 70 minutes later, airline sources said.

It is the first cargo flight service between South Korea and Shandong, its largest investment destination in China. South Korea has invested about 20 billion U.S. dollars in the eastern province through 2007, accounting for 27 percent of its China investment.

The new route boosts economic exchange between Shandong and South Korea and gives China Postal a better footing in the international market, according to the China Postal Airlines source.

Currently, there are 18,000 companies that have been directly invested by South Korean businesses in Shandong, half of the total in China.

China Postal Airlines will fly from Yantai to Seoul five times weekly, according to company sources. Express mail from the province can arrive at Seoul, Gyeonggi and Incheon in South Korea the next day and in other cities a day after that.

Shanghai-based China Postal Airlines, a 51/49 percent joint venture between China’s State Post Bureau and China Southern Airlines, boasts a fleet of 13 aircraft and operates 30 flights to a dozen domestic cities. The company’s delivery network covers more than 300 Chinese cities.

In line with its commitments to the World Trade Organization, China has fully opened its express delivery market. International delivery companies such as DHL, TNT and UPS are now competing in China.

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Toll profits from Asian expansion

Posted by | Feb 21, 2008 | |

Australian transport and logistics group Toll Holdings announced today it is profiting from its expansion into Asia and good domestic demand. The group has made two express acquisitions in Australia but could soon sell its majority stake in the Virgin Blue airline.

The listed company, whose businesses include leading Australian express operators, announced net profits up 10.7pct to AUD 237 million (EUR 147.8 million) for the half-year ending December 31, 2007. Underlying operating profit (EBIT) rose 13pct to AUD431 million on revenues up 8.3pct to AUD 4.1 billion.

Toll Australia, covering all Australia-based businesses, improved its EBIT by 18pct to AUD 184 million on revenue up 7.3pct to AU D2.3 billion. The company said it benefited from higher volumes generated by the resources sector and buoyant retail sector demand, as well as new facilities and upgraded fleet and technology.

Although Toll does not release figures for its express businesses Toll IPEC, Toll Priority and Toll Fast, it said that “the time sensitive operations of Toll IPEC and Toll Priority continued to drive improved results”, despite Toll Priority’s one-off costs for the creation of an air linehaul network.

In July, Toll Priority launched a dedicated cargo fleet of three B737s and two ATRs, supported by 50 chartered aircraft. The B737s operate between Brisbane, Sydney, Melbourne and Perth, while the ATRs fly between Brisbane, Sydney, Melbourne and Adelaide. It also sealed a long-term agreement with Virgin Blue for exclusive access to bellyhold capacity on the passenger airline’s domestic and international flights.

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Vietnamese and French post groups to offer direct mail

Posted by | Feb 21, 2008 | |

The Vietnam Post Corporation (VNPost) and the La Poste Group of France will jointly launch cost-effective Direct Mail service in Vietnam in April.

Responsible for the service will be these groups’ Post Media Joint Stock Company, which is participated by Smart Media, a joint stock company founded by the Vietnam Post and Telecommunications Group.

The Post Media company, which is undergoing final legal procedures for its official operation, is established under an agreement signed during Prime Minister Nguyen Tan Dung’s visit to France in September 2007.

At a recent working session with VNPost, La Poste Chairman Jean Paul Bailly said his group wants to expand cooperative ties with VNPost to other fields, including the supply of financial, insurance and banking services through postal system.

He also affirmed La Poste’s willingness to help VNPost link with electronic money transfer system of France and Europe.

According to VNPost General Director Do Ngoc Binh, VNPost and La Poste signed a memorandum of understanding on their cooperation in December 2005.

The two groups have by now collaborated in setting up the Post Media company, and providing express and electronic money transfer services, and personnel training for VNPost.

La Poste is interested in helping VNPost establish a joint stock bank and develop life insurance products, Binh said.

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