Monday, 29 July 2019

Market Live: Nifty below 11,250, Sensex trades lower; auto, metal under pressure

Among sectors, except FMCG and IT all other indices are trading lower led by the auto, metal, pharma, energy and infra.

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Brokerages View:
Goldman Sachs on Maruti Suzuki

Maintain buy, target at Rs 7210 per share
Q1 results above estimates on cost control; buy on weakness
See EBITDA margin to have bottomed out as we expect better volume hereon

Citi on Maruti Suzuki

Buy call on the stock with target at Rs 7,400 per share
Q1 results a modest beat but near-term outlook gloomy
Co would likely outperform given sustained market share & balance sheet strength

IDFC Securities on Maruti Suzuki

Outperform rating with target at Rs 6,400 per share
Demand environment continues to remain weak with no overt signs of a recovery
Expect pressure on margin to continue in the near-term

CLSA on Maruti Suzuki

Maintain buy call with target at Rs 7,400 per share
Maruti reported weak q1 results as volume fell 18% YoY
Believe Maruti is a better way to play a potential demand recovery

UBS on Maruti Suzuki

Sell call with target at Rs 5800 per share
Q1 a consensus miss amid a tough environment
EBITDA below consensus, adjusting for estimated AS-116 impact

CIMB on Maruti Suzuki

Reiterate add rating with target at Rs 7,776 per share
Q1 EPS fell 20% QoQ In-line with consensus but 26% above estimate
Key risks are fuel price spike impacting car industry demand

Kotak Institutional Equities on Escorts

Maintain buy call; target cut to Rs 910 from Rs 1,000 per share
Co reported a 23% YoY decline in EBITDA mainly led by decline in tractor volume 
Believe the tractor segment has least headwinds related to cost increase

Credit Suisse on Escorts

Outperform rating with target at Rs 920 per share
Q1 headline numbers were broadly in-line with estimates

Nomura on Jubilant Life

Maintain buy call on the stock; raise target to Rs 661 from Rs 660 per share
Q1 EBITDA up 21% QoQ but 1% below our estimate

UBS on Bajaj Auto 

Maintain sell, target at Rs 2,400 
Q1FY20 in-line but market share plateauing despite aggressive pricing
High inventory adds to downside risk

IDFC Securities on Bajaj Auto 

Maintain underperform, target at Rs 2,400 per share 
Company’s strategy of cutting product prices to gain market share may benefit it over long term
Key upside would be a stronger-than-expected export market growth 

Kotak Institutional Equities on Bajaj Auto 

Maintain reduce, target cut to Rs 2,500 from Rs 2,700 per share
Slowdown led by a weak rural economy & sharp rise in regulatory costs

Nomura on Bajaj Auto 

Maintain neutral; target at Rs 2,836 per share
Q1 results in-line; growth slowing down 
Margin headwinds remain from adverse mix & regulatory cost pressures

Credit Suisse on Bajaj Auto 

Underperform, target at Rs 2,330 per share
Increasing competitive intensity in exports could jeopardise company’s profit
Cut FY20/FY21E EPS by 5%/8%, factoring in the further cautious outlook

Morgan Stanley on Bajaj Auto

Remain equal-weight with target at Rs 2,646 per share
Co Posted an in-line quarter 
EVs & emission regime change are key risks to the business

CLSA on Bajaj Auto

Fine tune our estimates & retain sell call with target at Rs 2,275 per share
Muted Q1 but better than estimates
See risk to 2-wheeler exports given the weakening global economic outlook

Jefferies on Bajaj Auto

Maintain underperform rating with target at Rs 2,430 per share
Management expects negative growth in domestic 2-wheeler industry for short-term
Adjusting for A/Cing changes, Q1 revenue was ahead, EBITDA in-line & margin below estimates

CLSA on ICICI Bank

Co is a high-conviction buy with target at Rs 530 per share
Q1 PAT tad below estimates due to higher provisions & higher tax
Trim earnings but see an earnings turnaround ahead & RoE rising to 15-16%

Jefferies on ICICI Bank

Retain buy call on the stock; raise target to Rs 480 from Rs 455 per share
Steady Q1 with core PPoP driven by better loan growth & steady margin
Fees were negatively impacted by lower mutual fund distribution fee
Expect improvement in core op profit; standalone RoE likely to be over 16% by FY21

Jefferies on JSW Steel

Retain underperform; cut target to Rs 216 from Rs 233 per share
Cut our FY20-21e EBITDA by 2-3%
Q1 EBITDA missed our estimate; margin was in-line, but volume disappointed

CLSA on JSW Steel

Cut our FY20-21 EPS by 4-5%
Retain sell rating; cut target to Rs 200 from Rs 225 per share

CLSA on autos

Believe govt’s proposal of higher registration fee is unlikely to boost auto demand
Believe regulatory costs are adding up for the Indian auto industry
Entered 2019 with a cautious view on autos & see few reasons to change it
Have sell ratings on 70% of our auto coverage; recommend underweight stance on sector.


MORE WILL UPDATE SOON!!

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