Morgan Stanley is overweight on the stock with a target of Rs 530. It says that the post-quarter update points to a strong Q4 and expects consensus to revise earnings over the next few days. It also cited the management’s optimistic stance of high-teen revenue growth for FY18.
Meanwhile, JPMorgan has maintained its neutral rating with an increased target price to Rs 455 from Rs 400.
Goldman Sachs has upgraded the stock to neutral from a sell call. The research firm believes the valuation post its recent underperformance reflects the risk of a margin miss. The target for the stock implies a 9 percent downside against 5 percent for the coverage group.
Morgan Stanley has doubled its upgrade on the stock to overweight and there are rerating triggers in sight as well. It expects earnings growth of 20 percent in FY18 from 8 percent in FY17. The research firm also sees broad-based growth to narrow PE discount to larger peers.
UBS has a buy rating on the stock with an increased target price of Rs 1,050 from Rs 900. It has raised the earnings per share (EPS) estimates by 10 percent in FY18 and 3 percent in FY19. The research firm has also factored in 3.4 percent equity dilution. It says banks offer one of the highest sustainable earnings growth over 5 years. It has raised FY18/19 estimates and expects a 29% EPS CAGR over FY17-20
Credit Suisse has maintained an outperform rating on the stock with an unchanged target of Rs 180. Q4 execution and profits for nine months to FY17 suggest a significant upgrade to the consensus. The company may report EPS of about Rs 71-72 in FY17.
Nomura has maintained a neutral call on the stock with an unchanged target of Rs 320. The FY17 output implies 2-3 percent rise in its normalized EPS.
IT sector
Nomura believes immigration tightening seen in the UK, US and Singapore as a negative for the Indian IT sector. It sees both margin and near-term growth being under pressure. It has cited 3 H1-B visa bills that are tabled in the House or the Senate since the Trump administration took over, but the actual passage will take 3-4 quarters. HCL Tech remains the only buyer in Tier-1 IT firms, while it remains neutral on Infosys, Tech Mahindra and TCS. It has maintained a reduce call on Wipro.
Autos
CLSA believes the impact of demonetisation seems to be behind passenger vehicles, but two-wheelers and commercial vehicles remain weak. However, it is also growing sequentially. Based on volumes of original equipment manufacturers, the research firm estimates PV industry to have grown over 10 percent, while M&HCVs were seen at 5-7 percent in March. It sees less pre-buying in M&HCVs due to BS-IV norms raise concerns for FY19 outlook.
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