IL&FS Investment has maintained a ‘buy’ rating on the on Reliance Communications’ (RCom) with a long term target of Rs 610.

According to IL&FS, investors can purchase the stock between Rs 525-530 with a strict stop loss of Rs 507.

Today, the company’s shares opened at Rs 537, as against its last closure at Rs 539.05 on Friday (May 9), on the Bombay Stock Exchange (BSE). Current EPS and P/E ratio stood at 12.53 and 42.26 respectively. The share price has seen a 52-week high of Rs 844 and a low of Rs 455 on BSE.

The stock will achieve the target price as the company has aggressive growth plans and strong operating capabilities.

RCom has posted a phenomenal jump of 70.51% in consolidated net profit for the year ended March 2008.

The company recorded net profit of Rs 54,011.40 million, against Rs 31,675.90 million in the previous year. Total income climbed 31.8% to Rs 190,677.60 million from Rs 144,682.90 million for the year ended March 2007.

Recently, the Anil Ambani-controlled company acquired a controlling stake in UK-based eWave World, a telco focused on the rapidly developing market for wireless telephony services using the WiMAX technology standard.

The company has also decided to provide GSM-based mobile virtual network operator (MVNO) services across 57 countries in order to increase its revenues from global operations.

Moreover, RCom has signed up a joint venture (JV) contract with telecom infrastructure company Alcatel-Lucent to offer up Managed Network Services (MNS) to telecom service providers in the country.

Under the agreement, the companies will frame up a new entity that will provide managed network services to both CDMA and GSM networks in 12 circles in northern and western India.

According to the sources, the joint venture will support RCom’s growth as well as progression outside India when the Indian market is saturated.

RCom will spend $500 million over seven years for this service.