Yesterday,
MoneyGram International
(
MGI
) announced the addition of the leading Indian bank, State Bank of
India (
SBI
), to its extensive agent network in India.
Consequently, the company's in-bound money transfer service will
be available across SBI's 100 key branches in India by the end of
the year. The service will be rolled out across more branches
later.
SBI is India's largest commercial bank with over 13,800 branches
and 25,000 ATMs in the country, along with 131 international
branches in 32 countries. Thomas Cook (India) Ltd., which is
MoneyGram's super agents in India since September 2011, is also a
part of the deal. Thus, Thomas Cook's clients will be able to
access in-bound remittances into I ndia through SBI.
MoneyGram already has an extensive network in India, with about
34,000 locations and alliances with India's premier natio nalized
banks such as Bank of Baroda, Allahabad Bank, Axis Bank and Vijaya
Bank.
Additionally, in September 2011, the company announced an
alliance with India Post to provide instant in-bound money transfer
service in India. The service is currently available in only 100
post offices of India Post. However, the number will be increased
in phases to a bout 5,000 by 2014.
MoneyGram's growing network in India is expected to generate
substantial revenues for the company, as India is the world's
largest recipient country of remittances and the second largest
emigrating country, as per The World Bank's Migration and
Remittances Factbook 2011. The country received about $55 billionas
in-bound remittances in 2010.
Earnings Review
MoneyGram reported third quarter 2011 earnings per share of 3
cents, in line with the Zacks Consensus Estimate but significantly
higher than the loss of 30 cents in the year-ago quarter.
The Zacks Consensus Estimate for MoneyGram's fourth-quarter
2011stands at 32 cents per share, up about 112% year over year. Of
the 4 firms covering the stock, one revised its estimate upward,
while no downward revisions were witnessed in the past 30 days.
Currently, the earnings for 2012 are expected to be around
$1.09, up 111% year over year. MoneyGram competes with
Western Union Co.
(
WU
). The company carries a Zacks #1 Rank at present, which translates
into a short term Strong Buy rating.
MONEYGRAM INTL (
MGI
): Free Stock Analysis Report
WESTERN UNION (
WU
): Free Stock Analysis Report
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