Analysts Call Tracker January 2023

Overview
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Contrarion Upgrades
Contrarion Downgrades
How to

Analysts’ Call Tracker - Jan 2023

The biggest stock market story of January seems to have been the rout of Adani stocks, following the scathing report from Hindenburg Research. It is estimated to have wiped out $117 billion of the group’s market capitalisation. More recently, MSCI’s decision to reduce the number of freely tradeable shares of Adani Enterprises, Adani Transmission, Adani Total Gas and ACC, which caused further decline in the group’s stocks and analysts’ estimate that there will be a combined outflow of $500 million from all seven stocks. It seems like a bloodbath. Yet, even with all the discussions and brawls over what is unfolding, the benchmark index has not moved much. Nifty has continued to hum along at the 17,800-17,900 levels. What is emerging as worrying though is the continued selling of Indian securities by foreign investors. FIIs were net sellers in January by Rs 414.6 billion. With China reopening, the dominant theme among the foreign investors seems to be “Sell India, buy China”. If this sentiment holds up, domestic stocks that have a lot of exposure to FII will be vulnerable to significant correction. Also, the company’s earnings will emerge as a key determinant. If their earnings do not meet expectations or surprise on the upside, we can expect the Indian benchmark indices to feel the heat. The best view is the Street view, we say, and the best way to capture it is through our very own Analyst Call Tracker. It tells you which stocks analysts are growing partial to and which they are beginning to avoid, which stocks they are betting on and betting against, against the market trend. We bring you the tracker for Nifty Stocks for the month of January 2023, sourced from Bloomberg. We started this series last June, when caution was the byword. Now it seems caution is back in vogue again. The charts below give you a bird’s eye view, and links therein should give you the full story. Read footnotes for a lowdown on how to read the charts.

Hindalco Industries was the frontrunner among the list of stocks that analysts were most optimistic about in January, even though financial companies occupied half of the list.

Bajaj Finserv, Tata Motors and Bajaj Finance got the maximum upgrades by brokerages over the past month, while HDFC Bank received the highest number of buy ratings at 42, up from 38 last month.

When 2023 came knocking, investors were ready for a pause in interest rate hikes, slow cooling off of inflation, decreased volatility in raw material prices and slightly better returns from equity markets. But things don’t always go as planned.

How to read the charts:

Optimism is based on the percentage share of ‘Buy’ recommendations in total analyst recommendations filed with Bloomberg; pessimism is the share of ‘Sell’ and ‘Hold’ recommendations. Upgrades are an increase in the percentage share of ‘Buy’ in the total recommendations compared to what was a month ago; downgrades represent an increase in ‘Sell’ and ‘Hold’ out of the total recommendations. Contrarian Upgrades represent shares which have seen maximum increase in ‘Buy’ recommendations though their stock prices have fallen most (or risen least) during a given period. Contrarian Downgrades list shares that have seen an increase in 'Hold' or 'Sell' recommendations though their prices have risen most (or fallen least) during the given period. Reports are based on recommendations as of Aug 31, 2022. Source: Bloomberg.