Tata Communication’s share price continued to make gains for the second straight session as the stock jumped up close to 1% on Wednesday morning.
What Happened: Shares of the Tata Group company are upbeat today as CLSA maintained its ‘outperform’ rating on the stock raising the price target to ₹2,045 from ₹1,800. The new target indicates an around 10% upside from the stock’s last closing price of ₹1,876.25.
The global brokerage firm said that the new price factors in the Kaleyra acquisition. The company had acquired the U.S.-based telecom company back in June for around ₹820 crore. At the time as well, domestic brokerage firm ICICI Securities had said that the acquisition would help Tata Communications’ global standing in the CPaaS (Communications Platform as a Service) sector.
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CLSA said that the acquisition could lead to a 9%-16% upgrade in the company’s data revenue. The firm highlighted that Tata Communication’s major income – up to 80%-85% – comes from the data business.
However, the firm added that since the stock has surged up over 60% in the last 12 months, it is sticking with its outperform rating. The stock is up over 40% year-to-date.
Price Action: Tata Communication’s share price was up 0.60% to trade at ₹1,887.50 as the markets opened on Wednesday.
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