Morgan Stanley, Citi Research and Emkay have shared its outlook on Maruti Suzuki India Ltd. after a rally in the carmaker's share prices on registration fee waiver on hybrid cars declared by the Uttar Pradesh government. Emkay Global re-initiated coverage on HG Infra Engineering Ltd. and also shared its views on the fee slash by Uttar Pradesh for hybrid cars.
NDTV Profit tracks what the brokerages are putting out on stocks and sectors. Here are all the top calls from analysts that you need to know about on Wednesday.
Morgan Stanley On Maruti Suzuki
Maintains a 'buy' rating on the stock and a target price of Rs 14,105 apiece, implying a potential upside of 10% from the previous close.
Global EV slowdown, upcoming emission norms in India and news on policy support for hybrids.
Points to a portfolio of power trains being the best strategy in autos.
Maruti Suzuki, being a key player in hybrids, stands to benefit from this.
Key watchable is if other states follow suit.
Citi On Maruti Suzuki
Maintains a 'buy' rating on the stock and a target price of Rs 15,100 apiece, implying a potential upside of 18% from the previous close.
Maruti Suzuki is a top sector pick.
Uttar Pradesh announced full waiver of registration tax on strong hybrid cars.
Positive move for Maruti Suzuki, Toyota India and Honda Motor Co.
Uttar Pradesh contributed 10% of Passenger Vehicles sales and 11% of Maruti Suzuki's India's sales.
Could see further upside to volumes if other states follow.
Emkay On Maruti Suzuki
Maintains a 'reduce' rating on Maruti Suzuki and a target price of Rs 11,200 apiece, implying a potential downside of 13% from the previous close.
Maintains an 'add' rating on Mahindra & Mahindra Ltd. and a target price of Rs 3,000 apiece, implying a potential upside of 3% from the previous close.
Maintains an 'add' rating on Tata Motors Ltd. and a target price of Rs 1,050 apiece, implying a potential upside of 3% from the previous close.
Beneficial hybrid taxation is a positive, bringing them at par with electric vehicles.
Maruti Suzuki a major beneficiary of the registration-fee waiver for hybrids.
Leading to drop in on-road prices by 8–10% of Maruti Suzuki's Grand Vitara.
West Bengal has reduced registration fees on compressed-natural-gas cars.
These developments improve Maruti Suzuki's competitive positioning.
Underlying PV industry metrics remain weak; M&M and Tata Motors also announced price cuts.
M&M expected to outperform the wider PV industry with double-digit volume growth.
Goldman Sachs On CreditAccess Grameen
Maintains a 'buy' rating on CreditAccess Grameen Ltd. and a target price of Rs 1,784 apiece, implying a potential upside of 36% from the previous close.
Stress-tested the portfolio and it offers limited downside.
Company should be able to deliver a return on assets of 4.2% and return on equity of 17% with credit cost of 3.4%.
Stress-case scenario offers 16% downside to the stock.
Stress-case scenario assumes lower yields, higher credit costs and lower growth.
Expects a compound annual growth rate of 5.4% ROA, 23% ROE and 23% profit after tax in FY24–27 in base case.
Nuvama On Pidilite Industries
Maintains a 'buy' rating on Pidilite Industries Ltd. and a target price of Rs 3,545 apiece, implying a potential upside of 13.9% from the previous close.
Company remains optimistic about double-digit volume growth in FY25.
Raw material prices have largely bottomed out; it expects them to remain stable for the next six months.
Margins shall sustain in 22–24% band.
Capital-expenditure cycle would be upgraded for building new facilities; would be between 3% and 5% of revenue.
Lending business is still in initial stages with few pilots rolled out.
Company has ambitious plans to become a major player in the electronics and EV adhesive markets.
Core categories now make up 55% (down from 80%); 45% comes from growth and pioneer categories.
The core category would continue to do well.
Company has big plans to become a major player in the electronics and EV adhesive markets.
Acquisition of Water Displacement, 40th formula or "WD-40" has yielded clean results; the brand is now targeting to cater to both automotive and consumer needs.
Fevicol remains a powerhouse brand with over 200 stockkeeping units.
Fevicol's affordability discourages carpenters from seeking cheaper alternatives.
General elections may cause temporary volume softness in the first quarter of FY25 due to manpower mobility issues, transportation disruptions and slowdown in new projects.
Emkay On HG Infra
Re-initiates coverage with a 'buy' rating on the stock and a target price of Rs 2,100 apiece, implying a potential upside of 24% from the previous close.
Makeover from a small subcontractor into diversified infra play offers best in-class operating and financial metrics.
Saw order slowdown in FY24 in the runup to the elections and due to restrictions.
Expanding into railways where focus is on high-speed corridors, freight and station upgrade.
Railways, water and solar segments offer steady mid-to-long term earnings visibility.
Expects a compound annual growth rate of 21–22% each in revenue during FY24–27.
Values it based on sum-of-the-parts valuation.
Key risks include project delays, economic and policy scenario, competition, and commodity price volatility in consumables.
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