Brokerage: CLSA | Rating: Buy | Target: Rs 1,140
The global research firm said that incoming CEO Salil Parekh brings tenured experience in running a large IT services business. Further, it added that Nandan Nilekani has proven that the firm has dynamism to attract senior leaders from global peers. The company could also face internal distractions over the next few quarters. Speaking his tenure, CLSA said that Salil’s 25-year stint at EY & Capgemini gives him as good a chance to move up the value chain.
Brokerage: JPMorgan
The global research firm said that Salil Parekh’s appointment as CEO puts a welcome end to the uncertainty of leadership. In fact, it might surprise the street that an outsider was eventually picked as CEO. Having said that, the appointment could be seen in line with expected script.
Further, it added that investors would hope this appointment does not curtail Nilekani’s tenure & involvement. Going forward, it will be keeping an eye on management departures within the firm as a change at the helm can bring about some attrition in senior ranks. But, investors believe that chances of immediate internal attrition are slimmer.
Brokerage: CLSA | Rating: Sell | Target: Raised to Rs 350
CLSA said that Trastuzumab nod validates the company’s capability in development manufacturing of biosimilars. It estimates Trastuzumab launch at FY19-end & value this opportunity at Rs 30. It values other biosimilar opportunities at Rs 93 per share. Speaking on the stock, it said that the scrip is expensive even after building-in entire value of pipeline.
Brokerage: Citi | Target: Raised to Rs 525
The global financial services firm said that US FDA approval for Trastuzumab validates the firm’s capabilities in biosimilars. The nod also eases manufacturing concerns and improves ability to get nod in other markets. Citi has included the company in its top pharma picks. It expects the stock to deliver meaningful upside over long term.
Steel
Brokerage: BofAML
The research firm highlighted that reports indicate Indian steel majors have raised domestic steel prices by Rs 500-1,000/tonne. Further, it believes that price hike has been taken primarily to offset the cost push. It expects steelmakers such as Tata Steel and SAIL to benefit from raw material cost inflation.
Having said that, weak demand could limit full absorption of proposed hike, it said, adding that domestic steel upcycle has more legs & will be stronger for longer. It expects industry utilisation rates to rise to a 8-yr high of 84.4% in FY19. Among stocks, it prefers Tata Steel & JSW Steel.
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