The IRCTC Deal: Kaufman Bros Puts A ‘Buy’ On Sify With Price Traget Of $13

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New York-based equity research firm Kaufman Bros has put a “buy” on Sify stock. The main reason, of course, is the Indian portal-cum-internet access company’s tie-up with Indian Railways Catering and Tourism Corporation for selling tickets via former’s cybercafe chain – iWay. Kaufman has put a price target of $13 from the current $8. Excerpts from a note circulated by Sameet Sinha, an analyst with Kaufman Bros:
The state run Indian Railways has a monopoly on rail travel in India transporting about 5 billion passengers every year. There are long waits at the reservation center. So the value proposition for an online reservation system was simple and compelling, which led to the IRCTC ecommerce portal becoming the largest in Asia. Currently there are more than 1 million transacting users on the site which handles more than 13,000 transactions every day. The site accounts for 1-2% of total rail tickets sold and this is expected to reach 10% of tickets sold in 2-3 years.
-With 3400 iWays in 154 cities (and growing), Sify provides significant reach into smaller towns and cities. With a cybercafe within easy reach of millions of Indians, Sify has the opportunity to leverage the potential and significantly increase the monetization of its caf

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