This call was given to Premium Subscribers of my service at Rs.110, some days back, it was again given to free subscribers, at the CMP-->Rs.124.50, as it was still looking attractive; at that price. The stock opened in the upper circuits, but cooled down a bit after the markets cracked in late selling of the heavy weights:

Crest Animation Studios Ltd(BSE code-->526785): Buy at CMP of Rs.124.5 with a target of Rs.250 in the long term (18 to 24 months) and Rs.175--Rs.180 in the short to medium term and Rs.145--Rs.147 for very short term, keeping very short term Stop Loss of Rs.120 and then Rs.110 and then Rs.100. One of the promoters and Managing Director Seemha Ramanna has been constantly increasing the stake in the company from the last few months. Also, a scheme for adjustment of accumulated losses as at March 31, 2006 against the Share Premium Account as at March 31, 2006 under Section 100 to 104 read with section 78 of the Companies Act, 1956 had been filed with the Hon'ble High Court with the approval of shareholders of the Company and also The Hon'ble High Court vide its order dated March 02, 2007 approved the Scheme and quoted as follows:"The debit balance of Rs 15,31,89,310/- in the Profit and Loss Account as at March 31, 2006 is adjusted against the balance standing to the credit of the Share Premium Account to the extent of Rs 15,31,89,310/- as at March 31, 2006 in the books of the Petitioner Company, in terms of the Special Resolution passed at the Extraordinary General Meeting held on January 16, 2007.Accordingly, the Share Premium Account is reduced from Rs 90,31,67,873/- to Rs 74,99,78,563/- with effect from April 01, 2006".
The company is into animation space and which is looking good with the advent of CAS and so many channels in the Indian Media Space. This company has huge facilities and also has one of the low cost production costs that is, the average production costs for this company is very less as compared to many developed countries. In USA, animators cost about $125 an hour whereas they cost $25 an hour in India. Toonz Animation offers animation at 25% to 40% lower rates than even other Asian studios not to speak of the much higher rates American studios.

Realizing this competitive strength, the Indian animation industry is taking rapid strides and a major boom is unfolding in this sector. Overseas entertainment giants like Walt Disney, Sony, Imax are increasingly outsourcing cartoon characters and special effects to India. Other companies are outsourcing animation work from India for commercials and computer games. Based on the contracts on hand with animation studios, the industry is expected to grow over 35% CAGR in the next five years. NASSCOM estimates the size of the Indian animation market (developers perspective) at US $950 million by 2009 up from the US $285 million size of 2005. The NASSCOM study also highlights the following points:-
(1) All segments in animation are expected to witness growth with the entertainment sector dominating the market with an expected growth of 34.60% CAGR.
(2) The size of TV broadcast segment will witness a CAGR of around 21.1% to reach US $270 million by 2009.
(3) Fully animated movies in the Indian animation development market are expected to grow to around US $180 million by 2009 from US $30 million in 2005, resulting a CAGR of 56.5%.

(4) Market size of visual effects is expected to reach US $95 million by 2009 from US $15mn in 2005.
(5) Direct to DVD segment is expected to witness a CAGR of 39.60% to US $95 million by 2009.

(6) Computer animation industry offers tremendous scope for enhancing the per animator revenuePer animator revenues in the TV segment are between US $30,000 to $40,000 per year, for in-home video and small budget theatrical segment, they are around US $80,000 to 120,000 per year.
As is widely acknowledged, computer animation in India is in the growth stage of its business cycle. What we have seen in the last few years is only a trailer of the emerging bigger picture and exciting returns are in store for investors in this sector. Hence grab this leader at an attractive price of Rs.124.5 before it goes out of reach after the declaration of the results for Q4 Fy-06-07.