Tag: Standout Brokerage Report

UBS gives DMart owner Avenue Supermarts a double upgrade

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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UBS, the global financial services giant, has executed a double upgrade for Avenue Supermarts, the parent company of popular retail chain DMart. This move comes as a significant shift in sentiment, as UBS has shifted its rating from ‘sell’ to ‘buy’ and substantially raised its target price for Avenue Supermarts’ stock. The new target price now stands at Rs 4,700, a remarkable increase from the previous Rs 3,700.

This upgraded outlook from UBS is based on a combination of factors that highlight the potential for growth and resilience within the Avenue Supermarts business model. UBS analysts believe that several cyclical parameters are currently trending positively for the company.

Structurally, UBS’s research indicates that DMart has ample room to coexist alongside industry giant Reliance Retail, positioning itself as a prominent national player.

One of the key implications of UBS’s upgraded outlook is a significant revision in the estimated financial performance for the fiscal year 2025. The brokerage firm has substantially increased its projections, now anticipating revenue, EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), and EPS (Earnings Per Share) to grow between 3 percent and 4 percent.

The medium-term outlook shared by UBS is equally encouraging. The firm expects that Avenue Supermarts’ expansion efforts, specifically the addition of new stores, will serve as a catalyst for growth. Additionally, discretionary spending by consumers is poised to act as an upside driver for the company’s financial performance.

This double upgrade from UBS signifies a notable shift in the perception of Avenue Supermarts within the investment community.

For more details, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bernstein upgrades Delhivery to ‘outperform’ amid positive outlook and earnings rebound

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Leading brokerage firm Bernstein in its latest analyst report has upgraded Delhivery, the Indian logistics company, to an ‘outperform’ rating. The upgrade comes as Bernstein expresses a positive outlook on the midcap and smallcap sector, with Delhivery specifically showcasing promising signs of bottoming out in terms of earnings and positive operating cashflow in the near term.

This upgrade marks a significant milestone for Delhivery after a prolonged period of stock gains, as the company has witnessed an impressive surge of more than 10 percent over the past month.

Bernstein’s decision to upgrade Delhivery is primarily driven by the brokerage firm’s favorable assessment of the company’s earnings trajectory and operating cashflow in the coming months. Delhivery has shown resilience in the face of challenging market conditions, leading Bernstein to believe that the company is on the path to recovery. This positive outlook has prompted Bernstein to raise its estimates for Delhivery’s EBITDA (earnings before interest, taxes, depreciation, and amortization) for the fiscal years 2024 and 2025 by an impressive 25-59 percent.

Also Read | Goldman Sachs, Norges Bank, BNP Paribas among 34 marquee investors buy stake in Delhivery after Carlyle exits

The upgrade from Bernstein holds significant weight as it acknowledges the company’s efforts to enhance its financial performance and strategic positioning. Delhivery has been working diligently to strengthen its foothold in the logistics industry, and the upgrade serves as a testament to the progress made. Investors and shareholders can take confidence in the fact that an esteemed institution like Bernstein has recognized Delhivery’s potential for future growth and profitability.

Delhivery’s stock has been gaining momentum recently, culminating in a notable 10 percent increase over the past month. This rise in stock price indicates a growing interest from investors and reflects the positive sentiment surrounding Delhivery’s future prospects. The upgraded rating from Bernstein is expected to provide further impetus to Delhivery’s stock performance, attracting increased attention from both institutional and retail investors.

For more details, watch the accompanying video

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Midcap private banks poised to outperform PSU banks, says Morgan Stanley

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Global brokerage Morgan Stanley believes that the large private banks are currently in a favorable position but it is the midcap private banks that are expected to outshine the PSU banks after a significant rally in the PSU sector last year. The renowned financial institution has identified its top picks, which include ICICI Bank and Axis Bank. In addition, they have marginally increased the target price for IndusInd Bank.

The global brokerage’s analysis indicates a favorable outlook for the private banking sector, and specifically the midcap private banks. These banks are predicted to surpass the performance of PSU banks, benefiting from the momentum gained by the PSU sector in the previous year. By focusing on midcap private banks, investors may be able to capitalise on the expected growth and outperformance.

Among the top bets suggested by Morgan Stanley, ICICI Bank and Axis Bank stand out. These institutions have been identified as strong performers within the midcap private banking space.

Moreover, Morgan Stanley has raised the target price for IndusInd Bank, indicating their confidence in its future prospects. The revised target price now stands at Rs 1,725 per share, compared to the previous target of Rs 1,550.

While the midcap private banks show great promise, it is worth noting that Morgan Stanley has made some adjustments to its outlook for State Bank of India (SBI). The firm has marginally lowered SBI’s rating from overweight to equalweight, with a target price of 715.

Despite this adjustment, Morgan Stanley maintains a positive stance on private banks overall and believes they remain in a favorable position.

In addition to the target price revision for IndusInd Bank, Morgan Stanley has also increased the target prices for two other private bank stocks. RBL Bank’s target price has been raised to Rs 180 from Rs 130, indicating a positive outlook for the stock.

AU Small Finance Bank has also seen its target price raised to Rs 965. These revisions further reinforce Morgan Stanley’s confidence in the midcap private banking sector.

For more details, watch the accompanying video

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Nomura sees 18% upside potential in this IT company, initiates coverage with ‘buy’ rating

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Nomura has initiated coverage on Coforge, an information technology company, with a buy rating, and a target price of Rs 5,050, which is a potential 17-18 percent upside from current levels. The brokerage house believes that the management change brings in rigour and focus on execution.

According to Nomura, the investment in technology will help improve the competitive intensity for Coforge going forward.

The firm expects 180 basis points (bps) margin expansion over FY23 and FY25 and during the same period Coforge is expected to witness a compound annual growth rate (CAGR) of 25 percent.

The key risks are slow execution, growth is expected to slow down, and a bit of impact on margins, but the biggest risk to the stock would be an overhang of Baring PE selling its stake in the company.

However, in terms of earnings and execution, Nomura believes the risk-reward is favourable and, hence, it is initiating coverage with a buy rating and a target price of Rs 5,050 on Coforge.

Also Read | Coforge raises FY23 revenue growth guidance to 22% after highest-ever order intake in Q3

The company has raised its revenue guidance for the financial year 2022-2023 to 22 percent from 20 percent after the firm witnessed the highest-ever order intake.

The firm registered a 5 percent sequential growth in revenue from October to December 2022 at Rs 2,055.8 crore, though it missed the CNBC-TV18 poll estimate. The tech company’s net profit came in slightly higher than CNBC-TV18 projections of Rs 225.3 crore.

Also Read | Coforge partners with Transcard to help insurers automate disbursements, collections

For more details, watch the accompanying video

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

This analyst expects Delhivery shares to double in three years

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Delhivery” isinid=”INE148O01028″ bseid=”543529″ nseid=”DELHIVERY” sector=”Courier Services” exchange=”nse”] Macquarie has initiated coverage on logistics operator Delhivery with an outperform rating and a price target of Rs 440. While the price target is a 42 percent upside from Friday’s closing levels, it is still lower than the company’s IPO price of Rs 487.

However, the brokerage said that the company’s stock is on a clear path to double over the next three years.

Macquarie cites Delhivery to be a play on five megatrends – growing e-commerce penetration, rising discretionary spends, formalisation, digitsation, and improving logistics efficiency. The company is the third-largest player in a $3 billion B2B express part-truck load market.

The firm also forecasts volumes to quadruple by financial year 2030 with a sustainable cost leadership position, positive unit economics, and no external funding needs.

Delhivery is expected to reach EBITDA breakeven by financial year 2026, according to Macquarie.

Macquarie foresees low-growth operating environment due to tighter funding conditions for e-commerce platforms. In case it becomes the new normal, the brokerage sees a 30 percent downside from current levels, which is a bear case possibility. However, Delhivery is well placed to consolidate its share during this period and look beyond this cyclical slowdown.

Delhivery on January 9, 2023 said that it has extended its partnership with content-to-commerce conglomerate The Good Glamm Group to implement end-to-end supply chain solutions and increase customer satisfaction.

As their long-standing supply chain partner, Delhivery has customised its services to complement Good Glamm Group’s growth and evolving logistics requirements.

As the D2C brand planned to accelerate sales from Tier 1 and 2 cities, it leveraged Delhivery’s pan-India network to reach Tier 3 and 4 markets.

Also Read | Delhivery extends partnership with Good Glamm Group to implement supply chain solutions

Delhivery collaborated with The Good Glamm Group in 2017 and now the two companies have accelerated their partnership on technology as well.

Shares of Delhivery are trading 3.7 percent higher at Rs 321.40.

For more, watch the accompanying video

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Kotak begins LIC coverage with a ‘Buy’ rating and sets target price at Rs 1,000 per share

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”LIC India” isinid=”INE0J1Y01017″ bseid=”543526″ nseid=”LICI” sector=”” exchange=”nse”]

Kotak Institutional Equities has initiated a buy rating on Life Insurance Corporation of India (LIC India) with a target price of Rs 1,000, a potential 40 percent upside from current levels as it believes that the current valuations largely ignore its inherent strengths.

The brokerage firm believes that LIC India’s dominance is unparalleled with a 37 percent APE market share in FY22. In fact company’s high productivity versus its peers remains the bedrock for LIC India’s market dominance as well as cost leadership.

The gradual shift in product mix should boost the value of new business (VNB) growth going forward despite moderate APE.

Also Read | Year ender – The insurance behemoth LIC’s hunt for growth continues

In fact, the account bifurcation has led to an increase in the embedded value and earnings despite a lower return on an embedded value that looks a little depressed.

The stock is currently trading at Rs 722.50 and was up 5.23 percent in the last week and 10.73 percent in the past month.

LIC listed at Rs 865/share, a 9 percent discount on its IPO price. Since then, it has been a ride that has kept investors on the edge of their seats. The stock hit its high on the listing day itself which was Rs 919/share and since then, it just refused to look north. The price slid all the way to Rs 588/share which was on October 21.

The slide between Rs 919 to Rs 588 took place in about 5 months and entailed a loss of Rs 2.1 lakh crore in market cap for LIC.

For more, watch the accompanying video

To watch other videos in this series, click on the Standout Brokerage Report tab below.

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Ambuja, ACC, UltraTech, Grasim, Nuvoco top picks for Citi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Ambuja Cements” isinid=”INE079A01024″ bseid=”500425″ nseid=”AMBUJACEM” sector=”Cement – Major” exchange=”nse”]

Citi has made some big changes to the cement sector stocks in its 86-page report. The brokerage firm has upgraded Ambuja Cements to a ‘buy’ from ‘sell’ raising its target price to Rs 610 versus its earlier target of Rs 340.

Citi has also downgraded JK Cement to ‘sell’ and Dalmia Bharat to ‘neutral’ with a target price of Rs 2,400 and Rs 1,650, respectively.

The top picks for Citi within the cement space remain ACC, UltraTech Cement, Grasim and Nuvoco.

The firm has raised the target price to Rs 2,900 on ACC.

The top sells are Shree Cement and Ramco Cement.

The key outlay from Citi is that they believe that the pricing will remain subdued despite a significant scope for consolidation. The firm believes the nature of consolidation will be that smaller players will be bought out by larger names most likely by Adani Group. Adani’s ability to service debt at a reasonable EBITDA per tonne may not encourage price hikes. That’s one bit.

Secondly, the belief that Adani Group’s ability to become the most efficient player by working out various cost levers will also mean that the focus will be on market share and not on pricing. So that’s the second bit from that note.

Also Read: Cement cos profitability seen dipping 15% on input costs

Interestingly, they have identified 84 million tonne of acquirable assets, which potentially could be bought by larger players like Adani and the names include the likes of India Cement (they have a 17 million tonne capacity), Sanghi Cement (6 million tonne capacity), JK Lakshmi Cement (14 million tonne), Star Cement (6 million tonne), HeidelbergCement (close to 6.5 million tonne capacity) and Nuvoco (close to 24 million tonne capacity).

Jaypee has already announced selling their cement asset. That name is also included in the potential list.

This list is largely been calculated on the basis of balance sheets strengths, maybe a bit of foreign ownership or for that matter, the succession worries as well.

Also Read: India Cements sells entire stake in Madhya Pradesh project to JSW Cement for Rs 604 crore

Broadly, the key changes are that the firm has upgraded Ambuja Cement to ‘buy’ and raised the target price there and has downgraded two stocks, which are JK Cement and Dalmia Bharat on the back of big consolidation happening.

For more, watch the accompanying video

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IndusInd Bank, Bandhan Bank, L&T Finance best picks in microfinance sector: Goldman Sachs

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”IndusInd Bank” isinid=”INE095A01012″ bseid=”532187″ nseid=”INDUSINDBK” sector=”Banks – Private Sector” exchange=”nse”]

Microfinance institutions in India are at an inflection point and the best way to play this is through Bandhan Bank, IndusInd Bank and L&T Finance, said global investment firm Goldman Sachs on Tuesday. With all three stocks trading at a discount of anywhere between 45 percent and 50 percent versus the 10-year averages, Goldman Sachs believes that the market is not pricing in any growth or any improvement in the return on assets (RoAs) for all these three companies.

In fact, Goldman expects the second half of FY22 to be strong in terms of improving loan demand as well as most of the provisions for bad loans are provided for and they are behind most of these companies.

On Bandhan Bank, Goldman Sachs has a buy rating with a target price of Rs 390. The brokerage firm expects Bandhan Bank to deliver best-in-class return on equities (RoEs) over the next three years.

On IndusInd Bank, Goldman Sachs has a buy rating with a target price of Rs 1,187. The global brokerage expects the bank to deliver pre-provision operating profit (PPoP) growth of a 19 percent compounded annual growth rate (CAGR) over the next three years and with a healthy RoA of 1.7 percent and RoE of over 15 percent over the next three years.

On L&T Finance, Goldman has a buy rating with a target price of Rs 100 and expects a PPoP growth of over 18 percent CAGR over the next three years with a healthy RoA of 2.7 percent and maintaining an RoE of over 13 percent.

Also Read: Goldman Sachs to lay off several hundred employees September onwards

Watch the accompanying video of CNBC-TV18’s Nimesh Shah for more details.

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

ABB shares slide as Credit Suisse downgrades stock to ‘underperform’ after bull run

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”ABB India” isinid=”INE117A01022″ bseid=”500002″ nseid=”ABB” sector=”Infrastructure – General” exchange=”nse”]

ABB India has seen a big upmove in the past few months. The stock is up 22 percent in the past month, 55 percent in the past six, and has rallied 76 percent in the last year. Considering the run-up valuations, brokerage house Credit Suisse has downgraded the stock to ‘underperform’ going ahead from their earlier ‘neutral’ stance.

The revised target price is at Rs 2,600 versus the current value of approximately Rs 3,275 per share.

Credit Suisse has noted that there is evidence of the investment cycle picking up but after the sharp run up, the stock is now trading at over 70 times FY23 price to earnings, which implies a much higher expectation from the street.

Also Read: ABB India offers gender-neutral parental leave for employees, including LGBTQ couples

Even on a discounted cashflow (DCF) model, the brokerage house sees a 20 percent compounded annual growth rate (CAGR) versus the all-time high margin of 20 percent.

Within that investment cycle space, the brokerage firm still has an overweight rating on Larsen and Toubro (L&T) and prefers Siemens over ABB from a valuation point of view.

Watch the accompanying video of CNBC-TV18’s Nimesh Shah for more details.

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here is why JP Morgan has downgraded all IT players from overweight to neutral

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Infosys” isinid=”INE009A01021″ bseid=”500209″ nseid=”INFY” sector=”Computers – Software” exchange=”nse”]

JPMorgan has downgraded Infosys, Tech Mahindra, Mphasis, and Persistent Systems to a ‘neutral’ rating from an ‘overweight’ rating.

The firm has turned more bearish on the IT sector as it expects the margin erosion to persist in the medium-term and stay meaningfully below the long-term averages. The firm also sees limited incremental margin levers going ahead.

The report states that the Indian IT names, even now, are trading at more than 40 percent premium to the pre-COVID long-term averages and that too when the peak growth is behind and the margins are structurally getting eroded.

Also Read: Infosys variable pay cut and TCS’ delayed bonus amid shrinking margins upsets Street

This is the primary reason why JPMorgan has turned bearish and downgraded all the remaining overweight stocks within the IT names to neutral. It believes that any meaningful upside from here should be a rally to exit into the IT names in India.

At the time of publishing (11:40 am) the IT sector was under pressure due to the valuation concerns raised by brokerages and the JP Morgan downgrade.

Watch the accompanying video for more

To watch other videos in this series, click on the Standout Brokerage Report tab below.

Catch the latest stock market updates with CNBCTV18.com’s blog

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow