Fuel seems to be the main concern for companies in present times. Brokerages tell you what to do with stocks of companies dealing in energy and also with the auto sector that is now starting to look cheap.
Bank of America- Merrill Lynch has a 'neutral' rating on Coal India with a target of Rs 400. The company has clarified that the production at the mines in Jharkhand has not yet been stopped and it has filed a petition against the Pollution Board notice asking for a stay on mine closures.
RBS recommends buying Tata Motors as risk-reward looks attractive, implying a near-zero value for JLR. High sensitivity to premium demand is a valid concern, but, with low debt-to-equity, its investments in expanding into mass segments, position it well for growth. However, they have cut their target to Rs 1,088.
The brokerage also recommends holding MphasiS with a target of Rs 450. The company's third quarter results seem much weaker than consensus expectations and confirm the continuing growth challenges. Margins are also likely to remain under pressure going forward.
JP Morgan has downgraded Adani Power to 'neutral' with a new target of Rs 90. Looming fuel shortage and growing leverage raise concern that Adani is growing beyond what cheap fuel sources can support.
