Brokerage Views: Morgan Stanley Overweight On India, Citi On LTIMindtree, Macquarie On TCS And More

Morgan Stanley remained 'overweight' on India as the country replaced China as the largest MSCI EM IMI market. Macquarie is bullish on Tata Consultancy Services Ltd., expecting more cloud migration deals with applications, while CLSA remains bearish on Bajaj Auto Ltd., owing to increasing competitive intensity.

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 Wednesday.

Morgan Stanley On Emerging Markets

India has displaced China as the largest MSCI EM IMI market.
India will continue to gain share due to market outperformance and liquidity improvement.
India is now the sixth largest market globally, narrowly behind France.
China's weight has fallen by half since peaking in early 2021.
Remained 'overweight' on India and 'underweight' on China in pan-Asia EM asset allocation.

Also Read: India To Extend Leadership Among EM Peers As Stock Market Boom Continues

Citi On LTIMindtree

Maintained a 'sell' rating on the stock, with a target price of Rs 5,635 per share, implying a potential downside of 12%.
Margins likely to see continued pressure.
Growth is moderate from cost takeout deals and demand outlook is better than last year.
Seeing easing in demand environment, but not seeing a pickup in discretionary spend.
Most of the deals are cost takeout deals which are competitive in nature.
Pipeline has lot of cost takeout deals.
Green shoots in demand may not result in improvement in order intake.
Customers selectively doing work on regulatory, investments for AI.
AI benefits will be partly competed out as companies bid aggressively for cost takeout.

Nomura On Asia Insights

Indian trade deficit takes flight in August amid turbulence in exports.
Higher gold imports and weak exports widen the trade deficit.
The services trade surplus increased to a seven-month high of $15 billion in August from $12.9 billion in July.

Exports:

Estimated the trade deficit rose to $26.1 billion in August from $24.3 billion in July.
Electronics and engineering goods continue to post stable growth.
Labour-intensive sectors such as textiles and gems and jewellery are underperforming.
Export volume growth has been tepid, with most of the rise driven by price effects.

Imports

Import growth moderated to 3.3% year-on-year in August from 7.5% in July.
Oil imports dropped sharply, but this was offset by a sharp surge in gold imports, which were around 104% year-on-year.
Industrial and investment related imports continued to contract, while consumer goods imports picked up.

Broader implications

Widening in the trade deficit is unlikely to sustain.
External demand is a downside risk.
Expects a current account deficit of 1.1% of GDP in fiscal 2025, from 0.7% of GDP in fiscal 2024.

Also Read: India's Trade Deficit Widens To Highest In Ten Months At $29.65 Billion In August

Macquarie On Tata Consultancy Services

Maintained 'outperform' rating on the stock with a target price of Rs 5,740 per share, indicating a potential upside of 27%.
Expects more cloud migration deals with applications and infra services.
TCS better placed than Infosys in winning bundled deals and has grown more during spending rebounds.
TCS trading at 27.6 times the price-earnings ratio for fiscal 2026 versus Infosys Ltd. at 27.4 times.
The target price is based on 35 times the price-earnings ratio for fiscal 2026.

CLSA On Bajaj Auto

Retained an 'underperform' rating on the stock with a target price of Rs 7,000 apiece, implying a potential downside of 40%.
Bajaj and Triumph launched two motorcycles—positioned as entry level motorcycles.
The Speed T4 hits the right spot with attractive pricing, it said.
Bajaj delivered 60,000 Triumph bikes in fiscal 2024.
Remained cautious on the increasing competitive intensity in the premium motorcycle segment.
Growth moderation in >250 cc motorcycle as segment is growing slower than overall motorcycle industry.
Continued pressure in export markets.
Volume run rate has not changed much since launch of the first Triumph bike.
Stock trades at 33 times the price-earnings ratio for fiscal 2026.

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