Brokerage: HDFC Sec | Rating: Initiate coverage with buy | Target: Rs 1,200
The brokerage house said that post Agila sale in 2013, the company’s topline has grown at 47 percent CAGR. Further, it added that majority of investments are now complete and the company could see earnings CAGR of 18/34 percent over FY17-20.
Brokerage: Motilal Oswal | Rating: Initiate coverage with buy | Target: Rs 130
The brokerage house said that 4 M&A transactions in the 5 years helped the company become a strong media service player. Further, the company should see 15/18 percent revenue/EBITDA CAGR over FY17-20. It also said that the firm was well placed to benefit from rise in VFX budgets of Hollywood movie grossers.
Brokerage: UBS | Rating: Buy | Target: Rs 140
UBS observed that the results were ahead of estimates, while the margin surprised. It remains positive on the bank given the strong forecast for loan growth of 22-26 percent. It also said that there were lower asset quality risks and valuations looked reasonable.
Brokerage: Deutsche Bank | Rating: Buy | Target: Rs 135
The global financial services firm said that the bank’s Q2 showed that asset quality was stable and strong loan growth was seen at 25 percent. The slippages have normalised and capital infusion will drive improvement in net interest margins (NIMs). Having said that, it believes the valuations are a bit rich, but could sustain given a strong growth expectation.
Brokerage: Morgan Stanley | Rating: Equal-weight | Target: Rs 95
The global research firm said that net interest income (NII) growth was offset by higher provisions and lower treasury gains. It sees return on equity staying below cash on equity over the next few years and valuations at 1.8 times FY19 book is not cheap.
Brokerage: UBS | Rating: Buy | Target: Rs 1,250
The brokerage said that post GST, price-corrected stocks have only just begun to reach consumers and there is an indication of 60 days of inventory pipelines with trade. It also said that volume uplift, which was being expected from GST, is still to come.
Brokerage: Credit Suisse | Rating: Neutral | Target: Rs 1,025
Credit Suisse said that volume decline in restocking quarter paints a gloomy picture, while the market share continues to trend down. It also said that besides Patanjali, there is an increasing pressure from Dabur and HUL in naturals segment. The hope of GST-led realisation gain translating to high earnings has not played out, it observed.
Brokerage: CLSA | Rating: Sell | Target: Rs 1,000
The global research firm said that volume declined for the firm along with likely market share loss. It estimates a drop in market share to below 54 percent in toothpaste and the realisation also missed its forecast.
Brokerage: Morgan Stanley | Rating: Underweight | Target: Raised to Rs 910
Morgan Stanley said that the company will need to catalyse growth to defend its share against Patanjali, HUL and Dabur. It expects only a gradual improvement in underlying domestic volume growth. The second half of FY18’s reported volume growth could accelerate from a weak base.
Brokerage: Prabhudas Lilladher | Rating: Reduce | Target: Rs 1,007
The brokerage house estimates 13% profit CAGR over FY17-20. The firm currently trades at 37 times September Fy19 EPS, which limits the scope for re-rating.
Brokerage: Goldman Sachs | Rating: Sell | Target: Rs 785
The global investment bank said that the company’s toothpaste market share declined as competitors with ‘naturals’ based formulations gained share. The firm is unlikely to see high single-digit volume growth and margin expansion. But the mix may deteriorate and raise marketing spends.
Brokerage: Emkay | Rating: Buy | Target: Rs 267
The broking firm expects even stronger earnings growth momentum. Further, it added that rising footfalls in Goa/Sikkim casinos & ramp-up of gaming business will drive earnings. It lifts FY18/19 earnings forecasts by 19/24 percent. On a broader note, it said that the firm is a multi-year growth story with profits rising 85 percent in FY18 and 55 percent in Fy19. A key catalyst could be the acquisition of online rummy business. Moreover, a finalisation of Goa casino policy to shift offshore casinos to land will be positive.
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