Brokerage Radar: Morgan Stanley bullish on Kaynes Tech, Citi Research advises caution on Tech Mahindra

Brokerage Radar

Check out the latest brokerage calls and analyst comments on the stocks in action today. Our coverage includes Tech Mahindra, HAL, Kaynes Tech and more.

Antique On Hindustan Aeronautics
Buy Call, Target `6,145/Sh
Cabinet Clears Procurement Of `26,000 Cr Order For 240 Aero Engines Of SU-30 MKI Aircraft
Order Will Further Bolster Cos Already Strong Order Backlog Of `94,000 Cr (FY24 End) To `1.2 Lk Cr
Strong Order Backlog Will Lead To Strong Revenue Visibility Of 3.8x Its TTM Revenue
Near-term Financials May Seem A Bit Volatile
Co Has Been Facing Challenges To Execute The Large Tejas MK I A Orders
Believe That Stock Is Attractively Valued With Multi-yr Double-digit Earnings Growth Potential
Stock Looks Attractively Valued With Robust Return Ratio Profile Of +20%

Jefferies On Alkem Labs
Underperform Call, Target `5,080/Sh
Mgmt Said That Boosting Operational Margin Will Be The Top Priority In Near-term
Investments In New Areas Will Take 2-3 Years To Bear Results
Co Aims To Be More Active In M&A And In-Licensing Going Forward
New Mgmt Plans To Pursue Profitable Growth Which Will Be Realised Via India, EM & CDMO Biz

HSBC On Rallis India
Reduce Call, Target `251/Sh
Tuning Biz Model To Play On Strengths, A Well Executed Plan Can Bolster Competitive Position
Planning To Double Domestic CP Market Share
Co Plans To Seed Revenue Over Next 4-5 Years; Turning Selective On Exports
Maintain Reduce Given Industry Headwinds

Morgan Stanley On Kaynes Tech
Overweight Call, Target `3,845/Sh
Government Approval For Kaynes Semicon Semiconductor Plant In Gujarat Is Positive
The Pending Government Approval Remained An Area Of Investor Concern
Co Had Earlier Indicated That Its OSAT Venture Could Garner Incremental Potential Revenue

Citi On Vedanta
Buy Call, Target `430/Sh
Co Announced 3rd Interim Dividend Of `20/Sh
Total Outflow On Account Of Dividend Would Be `7,800 Cr (Promoters Own 56.4%)
Co’s Net Debt Excluding HZL Was `61,000 Cr As Of Jun’24
Post Jun’24, Vedanta Has Raised Nearly `8,500 Cr On July 20, Issue Of 193.2 m Shrs Via QIP

Citi On Tech Mahindra
Sell Call, Target `1,260/Sh
Growth Is Still Difficult In The Current Environment
BFSI Is Improving But It Is Slow & Gradual
There Are 10-15 Actions In Play To Drive Margin
Focus Is On Costs To Drive Margins Initially Followed By Pyramid Optimisation
Some Part Of The Margin Improvement Will Be Invested Back
Wage Hikes To Be Reviewed In October

Jefferies On Telecom
In Q1FY25, Sector Revenue Growth Moderated To 7% YoY
Bharti/Jio Revenues In Q1 Up 9-10.5% YoY Respectively
Bharti/Jio Gained 35 bps/70 bps Market Share In Q1FY25
Voda Idea’s Market Share Declined To An All-time Low, With Market Share Loss In 16/22 Circles
Mkt Sh Gains Toward Bharti/Jio Likely To Continue Till Voda Idea Completes Network Invst
Expect Sector Revenues To Grow At A 15% CAGR To $38 Bn Over FY24-26

CLSA On Consumer Sector
Overweight Call On Zomato, Target `353/Sh
Underperform Call On Marico, Target `470/Sh
Underperform Call On HUL, Target `2,161/Sh
Quick Commerce Is Reshaping India's Retail Supply Chain By Flattening Distribution
Quick Commerce Giving New Brands Increased Visibility & Price Competitiveness
Zomato Will Be Largest Listed Beneficiary
Staples Marketers Marico & HUL Face Risks As Their Distribution Advantage Erodes
Unlisted Co Zepto Is An Upand-Comer With Much To Offer Its Customers
For Blinkit, See EBITDA & Net Profit Turning Positive By FY25
Blinkit Will Contribute Up To 37% Of Our FY26 EPS For Zomato

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