Brokerage: Equirus | Rating: Initiate coverage with long rating | Target: Rs 375
The brokerage house said that the company is likely to clock 14%/18% Revenue growth in FY18/FY19. Further, it said that power transmission and distribution business to be the strongest suit with 12 percent CAGR over FY17-20. It also expects interest costs/sales to decline from over 2.9 percent in FY17 to over 2.1 percent in FY20.
Brokerage: JM Financial | Rating: Buy | Target: Rs 239
JM Financial said that the contribution of black tea in UK now down to 70% from 85% earlier. It also highlighted the company’s approach to focus on herbal tea products. Going forward, it expects the premium product portfolio, rise in prices and lower costs to aid performance.
Brokerage: Motilal Oswal | Rating: Buy | Target: Increased 11 percent to Rs 305
The broking firm said that cost saving & other operating income is driving upgrades. This is along with factors such as headwinds factored in and Q1 fully reflecting impact of grade slippage. It expects accelerating volume growth and re-stocking to boost dispatches in the second half of this fiscal. Motilal Oswal also believes that the company is on track to achieve dispatch growth estimates to 580 million tonnes in FY18.
Brokerage: Motilal Oswal | Rating: Neutral | Target: Rs 2,400
The brokerage house highlighted the major observations given by German drug regulator for its Duvvuda unit. Having said that, it sees no revenue impact as it does not supply anything to the European Union. Speaking on other facilities, it said that Srikakulam clearance was necessary for Copaxone approval and it does not expect launch of Suboxone in the next 12 months.
Brokerage: HSBC | Rating: Hold | Target: Rs 2,430
HSBC said that the target has been increased to factor in Suboxone sales from FY19. Additionally, the EPS estimates for FY19/20 has been Raised By 6%/8%.
Brokerage: Morgan Stanley | Rating: Equalweight | Target: Raised to Rs 94
The global research firm sees muted order flows capping earnings upside risk. Meanwhile, it sees a positive cue from the progress on rejig in its international business. Further, it added that while improving domestic capex cycle bodes well, recovery will be gradual. On the same lines, it reduced FY19 consolidated earnings estimates (before extraordinaries) by 8 percent.
Brokerage: Edelweiss Securities | Rating: Buy | Target: Rs 990
The brokerage house said that structural outlook fy19 onwards remains strong despite near-term challenges. It estimates the company to clock 12%, 15% & 20% CAGR in revenue, EBITDA & net profit, respectively.
Brokerage: Credit Suisse | Rating: Re-initiate coverage with underperform | Target: Rs 190
Credit Suisse is valuing completely in-house EPC at lower 3x EV/EBITDA, given higher margin. Further, it said that it liked the company’s portfolio, strong balance sheet and ready InvIT to partk assets. The rating on the stock, it added, is driven by lack of value accretion in several huge assets.
Brokerage: HSBC | Rating: Buy | Target: Rs 580
The global brokerage firm said that acquisition of Mumbai and Pune assets is value accretive. Meanwhile, rental income and profit should grow at CAGR of 13/30 percent in FY17-19.
Brokerage: Credit Suisse | Rating: Outperform | Target: Rs 1,955
Credit Suisse said that a savings rate cut to keep margin stable. Meanwhile, digitization will drive moderation in cost.
Power Sector
Brokerage: CLSA
CLSA said that green shoots were emerging, while discom losses fell 22 percent year on year. Further, lower AT&C, thermal costs should drive discoms to break-even by FY20. A likely restoration of viability of discoms by FY20 is the key catalyst.
India Strategy
Brokerage: CLSA
CLSA said that a recovery in earnings is imminent and the stage is set for Indian growth story and favourable macros. Strong, sustainable domestic equity inflows continue to support rich valuations. It added that major disruptive events recently have created a low base of economic & corporate activity. Insolvency & bankruptcy norms could drive significant NPA resolution over the next two quarters.
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