Buy, Sell, Hold: 6 stocks on analysts’ radar on January 19, 2018

The brokerage observed that port volume rebounded in Q3. It added that peaked capex & likely improved FCF may lead of tripling of dividend by FY19. It raised FY18 PAT estimates by 5 percent.

UltraTech

Brokerage: Credit Suisse | Rating: Underperform | Target: Raised to RS 3,500

The brokerage has reduced FY18/19 EPS estimates By 10/2%. Further, it said that positive in Q3 was JPA reaching exit utilisation of 60% vs 60% guidance by Q1FY19. It also said that JPA cost now is only rs 100/t higher than co, which can be bridged in 2 quarters.

Brokerage: Morgan Stanley | Rating: Overweight | Target: Rs 4,892

The company said that muted EBITDA/Tonne was a key earnings disappointment. Further, focus is on costs and pan-India presence which should drive strong earnings growth.

Brokerage: CLSA | Rating: Outperform | Target: Raised to Rs 5,000

CLSA said that Q3 earnings impacted by weak prices & higher costs. Further, it reported a broadly in-line quarter despite wide variance across heads. It added that the management sounded positive in its demand outlook.

Hind Zinc

Brokerage: Axis Cap | Rating: Hold | Target: Rs 324

Axis Cap said that it has maintained FY18/19/20 EPS estimates At Rs 24/27/30. Further, it values the company at five times FY20 EV/EBITDA.

Brokerage: IDFC Sec | Rating: Underperform | Target: Rs 278

IDFC Securities values the company at 7x FY20e EV/EBITDA. It said that results could have been better with increase in zinc & lead prices, but was offset by higher production cost.

Bharti Airtel

Brokerage: Deutsche Bank | Rating: Buy | Target: Rs 595

Deutsche Bank said that the firm successfully defended subscribers & rev-share at the cost of profit. India mobile were below estimates, Africa margin surprised on the upside.

Brokerage: Nomura | Rating: Buy | Target: Rs 625

Nomura said that interconnect usage charge cut drives 17% qoq drop in India wireless EBITDA. Further, revenue miss is driven by India mobile and has come in 6 percent below estimates.

Brokerage: CLSA | Rating: Buy | Target: Rs 640

The brokerage said that the company’s India ARPU surprised positively. Further, increased consolidated EBITDA and PAT estimates by 1-9 percent for FY19-21.

Yes Bank

Brokerage: Nomura | Rating: Buy | Target: Rs 375

Nomura observed that asset quality was relatively stable in q3. Further, no slippages from large pool of upgrades was done in Q2. It said that the key would be Q4 slippages as the company intends to avoid large divergence in FY18.

Brokerage: Deutsche Bank | Rating: Buy | Target: Rs 400

The bank said that loan growth comes at the cost of NIMs and a drop in the latter is discomforting.

Brokerage: CLSA | Rating: buy | Target: Raised to Rs 410

The brokerage sees 25% PAT CAGR over FY17-20. Further, it said that it missed estimates due to weaker NII & higher provisions. In fact, normalization of slippage is positive. Asset growth of 36% was back-ended & will lift NII in Q4.

Biocon

Brokerage: CLSA | Rating: Sell | Target: Rs 350

The brokerage said that Sandoz collaboration a long-term positive. Further, the costs and profit will be shared equally between the two. Impact On R&D costs & capex in near-term won’t be significant.