Buy, sell, hold: 7 stocks that you can watch out today

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Moneycontrol Bureau

Here are seven stocks that analysts are watching out.

Axis Bank

Nomura has upgraded Axis Bank to buy from neutral with increased target price at Rs 550 (from Rs 540 earlier) as asset quality risks priced in.

The brokerage house says the bank is now catching up on stress recognition with peers. It feels revised slippages/credit cost guidance factored in the stress adequately.

Nomura expects normalised return on equities of 16.5-17 percent beyond this credit cycle and sees little scope for negative surprise on asset quality.

Eicher Motors

With maintaining underperform rating and target price of Rs 18,300 on Eicher Motors, Credit Suisse says Bajaj Auto's newly launched Dominar 400 provides the first direct competition for Eicher Motors.

The brokeage house feels enquiries as well as waiting periods have got impacted for Royal Enfield's Classic 350.

It says if the waiting period were to go, that could result in de-rating for stock and waiting period for Eicher's Classic 350 could get impacted if Dominar gains traction.

Bajaj Auto

Bank of America Merrill Lynch has maintained neutral rating on the stock with a target price of Rs 2,950 per share, saying the company is aiming for higher market share & improved product mix with Dominar launch.

The launch can provide the next leg of growth, says the brokerage, adding guidance of 10,000-15,000 units per month implies a 7-10 percent revenue uplift and improved product mix implies robust profitability.

Autos

HSBC feels price rise in commodities is downside risk to margins & earnings of auto companies. According to the research house, 2-wheeler segment is likely to be more at risk than 4-wheelers while Yen depreciation and strong product portfolio will mitigate some risks for Maruti Suzuki.

For Tata Motors, JLR business continues to be a dominant factor, the brokerage house says, adding Royal Enfield has the least earnings risk due to strong margins.

HSBC says TVS Motor's earnings are most at risk among its coverage.

The brokerage house has a buy call on Maruti Suzuki with a target of Rs 6,000, Tata Motors with a target of Rs 590 and Eicher Motors with a target of Rs 27,000 while it has hold rating on Bajaj Auto with a target of Rs 2,900, Hero Motocorp with a target of Rs 3,700 and TVS Motor with a target of Rs 350.