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MARKET EYE-Citi raises Unitech to 'buy' after Telenor settlement

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* Citigroup upgrades India's Unitech

to 'buy' from'neutral' and raises its target price to 38 rupees from 27rupees.* Upgrades comes after Unitech and partner Telenor

dissolve telecom joint venture Uninor, reaching a settlement ontheir longstanding dispute.

* The removal of the overhang makes Unitech an "attractiverisk-reward" stock, while valuations are also compelling,Citigroup says in a note dated on Friday.* Unitech is seeing steady sales and new launches, whileexecution is showing signs of improvement, Citigroup argues.* However, bringing debt levels further will be key, the bankadds.* Unitech shares up 0.2 percent as of 0636 GMT.

(manoj.dharra@thomsonreuters.com)