Subex will sell part of its business to NetCracker: Trading strategy

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Subex will sell part of its business to NetCracker
Subex, an Indian software solutions company that has rallied on a company's filing with the BSE. The filing said that the company plans to sell its activation business to NetCracker.

Subex didn't disclose the amount it will receive on selling the business. NetCracker is one of the leading Telecom OSS company. It is part of the $40 billion NEC group.

"The sale is a part of the company's strategic decision to exit non core businesses and focus on core products i.e. ROC Solutions (Revenue Assurance, Fraud Management, Partner Settlement, Data Integrity Management etc.) and Managed Services," Subex said in a filing to the stock exchanges.

Subash Menon, Founder Chairman, Managing Director and CEO said "Subex is strategically positioned to take advantage of these growth areas through its ROC and Managed Services Portfolio."

Financial: The company's sales per share comes to around Rs 69.70, meanwhile its price to sales ratio is of 1. The average PE ratio of the company stands at Rs 6.2 times where as its PE as of September 19, 2011 was 4.3 times. The price to cash flow of the company is 3.8 times although at the end of the FY11 was on 5.5 times.

Technical: The stock has been on a downward trend for a little less than a year now. On the Simple moving averages the 7 day SMA has crossed the 20 day SMA, and hence investors can open a small position more to test waters. If this crosses the 50 day SMA then there is a definite buy signal on the stock. DISCLAIMER: The views expressed in this article are the views of the author and do not reflect the views of our company. does not take any responsibility for any losses incurred by investors who take their cues from the above article

Story first published: Tuesday, September 20, 2011, 15:06 [IST]
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