Brokerage Views: Nomura On RIL, Motilal Oswal On HDFC Bank And More

Brokerages have shared mixed views on Reliance Industries Ltd. following its quarterly earnings, while Jefferies India Pvt. and Citi Research have JSW Energy Ltd. and JSW Steel Ltd. on their radar. Emkay Global has shared a note on the Indian investors strategy.

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 Monday.

Nomura On Reliance Industries

Maintains a 'buy' rating on the stock and raises target price to Rs 3,600 apiece, implying a potential upside of 15.8% from the previous close.
Company remains the top pick in the sector.
June-quarter results in line; order-to-cash delivered well in a challenging environment.
Net income of Rs 15,100 crore was 2% below brokerage estimates.
Consolidated net debt moderated sequentially to Rs 1.12 trillion.
Capital expenditure rose to Rs 28,800 crore versus Rs 23,200 crore in the fourth quarter of FY24.
Trims FY25F/26 Ebitda estimates by 3%/2%.
Optimistic outlook on retail store additions, Jio's tariff increase and O2C benefiting from strong global oil.

Macquarie On Reliance Industries

Maintains a 'neutral' rating on the stock and a target price of Rs 2,750 apiece, implying a potential downside of 11% from the previous close.
Q1 was a material miss against consensus estimates.
Oil-to-chemicals segment was the key EBIT drag.
Retail saw lacklustre revenue growth with elevated store closure.
Continues to see downside to earnings per share.
Maintains relative preference for Bharti Airtel Ltd.
Lower FY25/26 earnings by 4%/1% post results.

Citi on Reliance Industries

RIL reported a weak first quarter, with misses in three of its four key business segments.
Extent of O2C decline, continued retail weakness was particularly disappointing.
Lowers FY25/26 EPS estimates by 6%/3%.
O2C Ebitda fell 22% QoQ on sharp decline in refining cracks.
Jio tariff hikes to benefit the company from the second quarter.
Retail segment saw another weak quarter, management attributed softness to weak discretionary demand.
Oil & gas segment saw lower production.
To watch out for: Upcoming annual general meet, investors keen to hear updates on Jio and retail listing, timelines on new energy project commencements.

Citi On Wipro

Maintains a 'sell' rating on the stock and a target price of Rs 495 apiece, implying a potential downside of 11% from the previous close.
Wipro delivered a weak first quarter.
Wipro's growth and valuation differential versus peers stays.
Wipro stock is up 27% since June factoring in a sharp recovery.
No early signs of recovery seen though.
Valuations at 29x are high – remain cautious and selective.

Emkay On India Strategy

Sees risk of an imminent 5–10% correction in headline indices.
See risk of bigger drawdowns in small and mid-cap stocks.
Nifty valuations stretched at 21.4 times the one-year forward price to earnings ratio.
Sees no additional positive catalysts; expects tepid earnings in first quarter of FY25.
Selloff likely to be led by industrials and financials.
Best places to hide are staples, energy and technology, in that order.
Remains constructive on India from a longer-term perspective.
Brokerage will use meaningful correction to increase exposure to the market.

Jefferies On JSW Energy

Maintains a 'buy' rating on the stock and a target price of Rs 840 apiece, implying a potential upside of 18% from the previous close.
June-quarter Ebitda 5% lower than expectations, profit stood 17% higher.
Lower utilisation at select plants due to outages to be made up.
Company on track to hit 9.2-gigawatt capacity by FY25.
Company on track to hit 11.5 GW capacity by FY27.
Expects 25%/32% Ebitda/EPS compound annual growth rate over FY24-27.

Citi On JSW Steel

Maintains a ‘sell’ rating on the stock and a target price of Rs 650 apiece, implying a potential downside of 26% from the previous close.
June quarter standalone EBITDA fell 12% YoY on lower blended realisations.
Performance of US operations worsened sequentially.
Management indicated India spreads should improve despite soft steel prices.
Average Q1 utilisation at 83% versus 93% in Q4 on planned maintenance shutdowns.
Expect Q2 realisations to be lower than Q1.
Lower standalone EBITDA per tonne to Rs 9960/Rs10500/Rs10600 for FY25/26/27.

Nuvama On JSW Steel

Maintains a 'hold' rating on the stock and a target price of Rs 914 apiece, implying a potential.
June quarter FY25 consolidated Ebitda down 10% QoQ, but in line.
Indian operation's Ebitda contracted 8% on lower volume and inventory loss.
Expects second quarter FY25 Ebitda per tonne to improve by Rs 700–800 QoQ.
Cuts FY25 Ebitda estimates by 9%, factoring in higher operating cost.
Awaits lower entry points to re-enter the stock.

Citi On UltraTech Cement

Maintains a 'buy' rating on the stock and a target price of Rs 13,000 apiece, implying a potential upside of 15% from the previous close.
June quarter Ebitda was 6% ahead of Citi estimates on higher volumes/ready-mixed concrete sales
Management states costs to come down by Rs 300 per tonne over three years.
Price hikes will likely happen only post monsoon.
Company expects FY25 industry growth at 7–8%, own growth in double digits.
Estimates 12% volume CAGR through FY24–27.
Company indicated a resurgence of construction activity in Bihar and Andhra Pradesh.
Expects return on capital employed to rise from average of 13% to 17%.
Revises FY24/25/26 consolidated Ebitda estimates by -7%/-1%/0%.

Nuvama On UltraTech Cement

Maintains a 'hold' rating on the stock and a target price of Rs 11,800 apiece.
First quarter Ebitda was 10% below consensus estimates on lower realisations, one-off expenses.
Management expects operating cost savings of Rs 250–300 per tonne over next three years.
Healthy-capex plans to allow the firm to outperform industry growth.
Increase target enterprise value/Ebitda to 18 times from 17 times.
Lowers FY25/26 Ebitda estimates by 6%/1% on weak pricing environment.

Motilal Oswal On HDFC Bank

Maintains a 'buy' rating on the stock and a target price of Rs 1,850 apiece, implying a potential upside of 15% from the previous close.
Net interest margins to improve 3 basis points sequentially.
Business growth muted; elevated credit-deposit ratio to suppress loan growth.
Estimates 16% CAGR in deposits and 10.1% CAGR in loans over FY24-26.
Value at 2.3x FY26E price by volume chart and Rs 256 for subsidiaries.

Motilal Oswal On Kotak Mahindra Bank

Maintains a ‘neutral’ rating on the stock and a target price of Rs 1800 apiece, implying a potential downside of 1% from the previous close.
Margin declines sharply by 26 basis points QoQ.
Loan growth steady; Credit-deposit ratio rises 340 basis points QoQ on flat deposit base.
Moderate growth in unsecured advances affected the yields.
Healthy performance despite the ban by the Reserve Bank of India.
Removal of the ban remains critical.
Values at 2x FY26 PBV chart + Rs 575 for subsidiaries.

Citi On Bharat Petroleum

Maintains a 'buy' rating on the stock and a target price of Rs 380 apiece, implying a potential upside of 24% from the previous close.
Retains firms as preferred oil marketing company.
Bharat Petroleum Corp. reported a soft first quarter, albeit in line with expectations.
Lower results on declining guest room management systems and marketing margins.
Bharat Petroleum Corp.'s deleveraging continues to impress the most among OMCs.
The company is exploring locations for a greenfield refinery.
Bina refinery expansion and petrochemicals project to be completed by FY29.
FY25E capital expenditure target maintained at Rs 16,400 crore.
Lowers FY25/26 BPCL GRMs to $8.5/9.0 versus $9.5/9.5 earlier.
Lower FY25/26 Ebitda estimates by 11%/4%.

Nuvama On Transformers And Rectifiers

Maintains a 'buy' rating on the stock and a target price of Rs 980 apiece, implying a potential upside of 37% from the previous close.
Over 13% office of personnel management levels for a second quarter in a row.
Order inflows grew 85% YoY to Rs 700 crore.
Order book inching up backlog to Rs 2,930 crore.
Management is guiding for FY25E revenue/Ebitda margin of Rs 2,000 crore/14%.
High voltage power transformer manufacturers are seeing a goldilocks.
Limited supply driving premium pricing and margins.
Qualified institutional placement of Rs 500 crore in June quarter FY25 to be used for organic and inorganic capex, strategic backward integration and repaying debt.
Operating margins likely to expand to 16–17% by FY27.
New facility for solar and green hydrogen transformers to be commissioned by December.
New facility adding 12,000 mega volt amp of annual capacity.
New facility shall manufacture additional 100 transformers/month realisation of Rs 12 million/transformer.

Bernstein On Paytm

Maintains an 'outperform' rating on the stock and a target price of Rs 600 apiece, implying a potential upside of 31% from the previous close.
Management hopes to deliver at least 1 profitable quarter in FY25.
Weaker payment margin, business slips into considerable loss.
Expects 55% decline in loan disbursements.
Expect profit-after-tax profitability in the fourth quarter of FY26.

Also Read: Stock Market Today: Nifty, Sensex End Lower For Second Consecutive Session Ahead Of Budget

Emkay Initiates Coverage On Indian Hotels

Initiates coverage on the Indian Hotels Co. Ltd. with 'add' rating and a target price of Rs 615 apiece, implying a potential upside of 6.4% from the previous close.
Slower revenue growth than previous quarters due to multiple headwinds.
Management maintains double-digit revenue growth in FY25 despite a weak start.
Cuts FY25/26 Ebitda by 0-3% factoring in Q1 performance.
Believes valuations are rich which limits upside.

Nuvama On Indian Hotels

Maintains a 'hold' rating on the stock and a target price of Rs 568 apiece, implying a potential downside of 1.7% from the previous close.
Elections and extreme heatwave led to weak revenue growth in Q1.
Management sees 20% growth in the first 17 days of July.
Expects second quarter of FY25 likely to surpass the first by a fair distance.
Revised revenue estimates for FY25E/26E by 12%/20%.
Believes valuations remain rich with strong growth priced in.

Macquarie on ITC

Rates the stock as ‘outperform’ with a target price of Rs 535 apiece, implying a potential upside of 13% from the previous close.
Sees above-peer EBIT growth for cigarette segment.
EBIT growth of 35–40% over next 10 years (versus 20% currently).
Pickup in the cigarette segment will not impact diversification in the non-cigarette segment.
Tailwinds across fast-moving consumer goods and hotels to offset weakness in paper.
Strong brand affinity and multiple margin levers to manage leaf tobacco inflation.
11% EPS CAGR over FY25–27E driven by the non-cigarette segment.
De-merging segments gaining scale as seen in hotels.
Valuation of 45x for FMCG led business and 20x for cigarette business.

Nirmal Bang on Ceat

Resumes coverage with a ‘buy’ rating on the stock and a target price of Rs 3,156 apiece, implying a potential upside of 18% from the previous close.
Positive stance stems from high single-digit volume growth going ahead.
Favourable pricing scenario, higher traction in exports and moderate capex intensity helping to sustain free-cash-flow generation.
Regulatory headwinds and higher raw-material cost to impact margins.
Continued market-share gains on the back of research and development and improving quality.
Capex intensity to remain benign with no fresh greenfield capacity in two to three years.
Values stock at 16x FY26 EPS.

Citi on Polycab India

Maintains a ‘buy’ rating on the stock and a target price of Rs 7,600 apiece, implying a potential upside of 20% from the previous close.
Strong Q1 growth; margins impacted by mix.
Higher growth in lower-margin business of FMCG led to 69-basis-point fall in margins.
Pickup in the wire growth should aid in recouping margin.
Increases inventory levels due to relatively weak demand in June.
Trims FY25/26 EPS estimates by 7%/5%.
Factoring in impact of adverse product mix.