Jefferies is bullish on Cholamandalam Investment and Finance Co., noting strong auto loan franchise and the company building a strong network in non-auto business. While, Emkay Global sees oil marketing companies earning supernormal marketing margins in the next month on the back of a decline in crude oil prices, potentially offsetting loss in subsidised LPG.
NDTV Profit tracks what brokerages are putting out on stocks and sectors. Here are all the top calls from analysts you need to know about on Thursday.
Emkay On Oil And Gas
International brent crude prices corrected by 15% over the last 15 days. The brokerage has made the following calls:
Maintained 'add' on Indian Oil Corp. with a target price of Rs 205 per share, a potential 21% upside over the previous close.
Maintained 'buy' on Bharat Petroleum Corp. with a target price of Rs 405 apiece (19% upside), Hindustan Petroleum Corp. with a target price of Rs 475 per share (16% upside), Oil and Natural Gas Corp. with target price of Rs 360 apiece (26% upside) and Oil India with target price of Rs 700 per share (20% upside).
Near-term volatility in oil prices could persist, it said.
Brent to de-rate to $70-80 per barrel range from $80-90 range earlier.
Corrections in ONGC, Oil India seems excessive.
OMCs could cut fuel retail prices amid upcoming state elections, it said.
It expects Rs 2 per litre cut for petrol and diesel towards Diwali.
OMCs could earn supernormal marketing margins in the next one month, covering LPG loss.
Expects second quarter marketing margins at Rs 9.7 and Rs 8 per liter for petrol and diesel, respectively.
Jefferies On Chola Finance
Maintained a 'buy' rating on the stock with target price of Rs 1,800 per share, implying a potential 19% upside.
The company has a strong auto loan franchise and is building strong network in non-auto business.
Net interest margin tailwind and beneficiary of the rate cut cycle.
Stable credit costs and provision unwind in LAP aided group credit cost.
Return-on-asset can expand by 20-30 basis points.
The company is valued at 4.5 times the September 2026 price-to-book estimate.
HSBC On Kalyan Jewellers
Retained 'buy' rating on the stock and raised the target price to Rs 810 per share from Rs 600 apiece, implying a potential upside of 26% over the previous close.
Kalyan’s stock has risen eight times in the past two years and the brokerage thinks it is midway into its value creation journey.
Capital light expansion continues at pace.
Exponential growth will likely prevent any multiple de-rating.
Sees several long-range catalysts and Titan's journey as a useful guide.
Kalyan has emerged as an entrenched national brand like Titan.
“Aspirational yet value” positioning makes Kalyan less prone to disruptive competition.
The firm sees opportunity to scale up Candere (studded jewellery), emulating Caratlane of Titan.
Valuation looks appealing if pitted against the high growth of other consumer opportunities.
Two long-range sources of margin tailwinds:
Having achieved scale, there is clear incentive for Kalyan to capture larger value by opening owned stores.
With a successful track-record, the terms of trade such as gold loan interest may start to come down as well.
Morgan Stanley On Tata Steel
Maintained 'underweight' on the stock with a target price of Rs 135 per share, a potential downside of 9% over the last closing price.
The signing of 500 million euro grant with the UK government is a positive development.
Limited clarity on renewed discussions with UK regarding grant funding was an overhang.
It awaits clarity on if there is additional financial support for affected employees.
No additional project cost to be viewed as incrementally positive.
Motilal Oswal On Piramal Enterprises
Retained 'neutral' with a revised target price of Rs 1,000 apiece, a 4% downside to the previous close.
Earnings estimates for the current and next fiscal only factor in exceptional gains from AIF exposures.
There is no tax incidence in the foreseeable future.
The brokerage does not see catalysts for any meaningful improvement in the core earnings trajectory.
It expects Piramal to deliver around 1.7% RoA and 6% return-on-equity in fiscal 2026.
The value of the lending business at 0.6 times the fiscal 2026 price-to-book estimate.
Morgan Stanley On PNB Housing
Maintained an 'overweight' rating and hiked target price from Rs 1,025 per share to Rs 1,520 apiece, a potential upside of 37%.
In three years, the company could be uniquely placed in the segment with scale across retail.
Would ensure a good balance of loan growth, asset quality and returns.
Good margin of safety for earnings and valuation.
Stock supply, midcap sell-off, weaker than expected earnings are key risks.
The firm sees re-rating of up to 2.5 times the fiscal 2027 price-to-book ratio over the next 12-18 months.
HSBC On Ola Electric Mobility
Maintained 'buy' rating with a target price of Rs 140 per share, a potential upside of 24%.
The company should grow faster than 5-6% CAGR for two-wheeler industry.
Product quality and sales service will be the key drivers.
Upcoming motorcycle launches next year should boost market share.
Ola's motorcycle launch in early 2025 could boost volumes.
Ola's market share dropped from 43.3% in the first half of 2024 to 28.9% in September is worrying. Decline may be due to new low-cost models from competitors like TVS Motor Co. and Bajaj Auto Ltd.
Risks include competition from Honda and Yamaha.
Current slowdown poses a 15-20% downside risk to earnings estimates of the current and next fiscal.
Nomura On Electronics Manufacturing Services
Industry
India’s inflection point in the electronics production will be led by PLI schemes, reduced imports from China, growing domestic consumption and initial success of global early movers.
India's electronics production can grow at a healthy 25% CAGR over the next six years.
Semiconductors manufacturing and packaging to be long-term growth drivers.
It expects India IT hardware segment to see strong growth from next fiscal, given government’s push for local sourcing.
Dixon Technologies
Initiated coverage with a 'buy' call and a target price of Rs 15,567 per share, a potential upside of 26%.
Key beneficiary of localisation in mobiles and IT hardware.
The company is likely to cater to 30% of India’s mobile industry by fiscal 2027, further upside from export.
Valuation at 60 times the estimates fiscal 2027 earnings per share.
Kaynes Technologies
Initiated coverage with 'buy' call and a target of Rs 5,969 apiece, a potential upside of 29%.
Strong order book driving high growth visibility.
The company is a play on the rising electronics content in B2B segment.
Samvardhana Motherson
Maintained 'buy' with a target price of Rs 204 apiece, an upside of 11%.
The company may benefit from addressing the component ecosystem.
Morgan Stanley On PM E-Drive Scheme
PM E-Drive scheme launched with an outlay of Rs 10,900 crore for two years.
Per unit incentives have decreased.
Not clear on the electric two-wheeler incentive per unit and analysis estimate that it appears to have dropped.
E-bus incentive benefits Ashok Leyland Ltd. and Tata Motors Ltd.
Broad trend remains that as PLI incentives are ramping up, demand-side incentives at the consumer level are seen decreasing.
Like the focus on developing charging infrastructure.
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