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Last Updated : Jan 23, 2019 11:22 AM IST | Source: Moneycontrol.com

Brokerage Calls: Asian Paints upgraded; TVS Motor remains a ‘sell’

Macquarie upgraded Asian Paints to outperform rating post December quarter results and also raised its 12-month target price to Rs 1580 from Rs 1180 earlier.

 
 
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We have collated a list of recommendations from global brokerage firms for Wednesday, January 23.

Asian Paints: Upgraded to Outperform | Raised target to Rs 1580

Macquarie upgraded Asian Paints to outperform rating post December quarter results and also raised its 12-month target price to Rs 1,580 from Rs 1,180 earlier.

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Volume growth has picked up significantly and the volume growth outlook has also improved, which is a positive sign.

The recent price hikes with falling input costs will improve margins, said the Macquarie note. The global investment bank also raised FY19-21 EPS estimates by 7-16 percent. The full effect of lower GST rates yet to play out, added the note.

TVS Motor Company: Sell| Target: Rs 360

CLSA maintained its sell rating on TVS Motor Company post-December quarter results with a target price of Rs 360. The company displayed good growth in December quarter but was largely in line with estimates.

Two-wheeler demand remains a big concern. TVS growth numbers were better in scooter/premium-bikes while on the other hand mopeds was a drag. Margin expansion unlikely amidst regulatory cost push and high competition, the note added.

Havells India: Outperform| Hike target to Rs 775

CLSA maintained its outperform rating on Havells India post Q3 results but raised its 12-month target price to Rs 775 from Rs 720 earlier.

The revenue growth surprises were visible across categories. The input costs impact consumer durables and Lloyd’s margins. Large channel inventory in the AC industry remains a concern, said the report.

Shree Cement: Outperform| Target: Rs 19050

Macquarie maintained its outperform rating on Shree Cement post Q3 results with a target price of Rs 19,050. Strong volumes have offset cost headwinds.

Cost deflation is likely to benefit from March Quarter, while price hike can drive upgrades. The capacity growth is likely to drive market-share gain in the next two financial years.

HDFC Life: Buy| Cut target to Rs 475

CLSA maintained its buy rating on HDFC Life but slashed its 12-month target price to Rs 475 from Rs 510 earlier.

The company recorded steady premium growth but with weaker persistency and margins. Steady credit protects business aids growth and profitability. Lower growth and margin forecasts are likely to drive 4-9 percent cuts to VNB forecasts for FY20-21.

Sun Pharma: Buy| Target: Rs 560

CLSA marinated its buy rating on Sun Pharma with a target price of Rs 560. Steps taken by the company to address governance issues is largely positive.

The outcome of whistle-blower complaint to SEBI will remain an overhang along with the outcome of DoJ investigation on price increases in the US. Valuation is fairly attractive given improving business fundamentals.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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First Published on Jan 23, 2019 11:22 am
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