Brokerage Views: Citi On Bajaj Finance, Vedanta, Morgan Stanley On IndusInd Bank And More

Bajaj Finance Ltd., IndusInd Bank Ltd. and Vedanta Ltd., are in brokerages' focus after they reported their earnings for the fourth quarter of financial year 2024.

NDTV Profit is tracking what the brokerages are putting out on specific stocks. Here are all the top calls from the brokerages that you need to know about on Friday.

Motilal Oswal On IndusInd Bank

The brokerage reiterates 'buy' with a target price of Rs 1,850 per share, a 24% upside from the previous close.
In line with performance, asset quality remains stable.
Management expects to maintain net interest margin in the range of 4.2–4.3%.
Bank utilised Rs 300 crore of contingent provisions, and now holds Rs 1,000 crore of contingency buffer.
Restructured book declined 8 basis points quarter-on-quarter to 0.4%.
Estimates the bank to deliver a 21% earnings compound annual growth rate over financial year 2024–26.
Leading to return on asset/return on equity of 2.1%/16.8% by fiscal 2026.

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Morgan Stanley On IndusInd Bank

The brokerage maintains 'overweight' with a target price of Rs 1,925 per share, a 29% upside from the previous close.
Asset quality improved along with strong retail deposit growth.
Profit after tax of 5% below the brokerage's estimate due to core pre-provision operating profit miss.
Higher funding costs are offset by an increase in asset yields.
Loan growth remained strong, moderated to 18% YoY vs 20% last quarter.
Gross slippages moderated due to corporate and retail.
Expect growth in core pre-provision operating profit to remain at 20% in fiscal 2024–26.

Citi On Vedanta

Citi reiterates 'buy' on Vedanta with a target price of Rs 425 apiece, a 12% upside potential from the previous close.
Marginally bullish on zinc on a 0–3-month view.
Sees zinc prices averaging $2,700/tonne in March quarter and 2025 on improving global growth expectations.
London Metal Exchange's Russia ban should be positive on aluminum.
Estimates net Debt/Ebitda, exclusive Hindustan Zinc Ltd., at 2.3 times as of fiscal 2025.
Management expects potential sale of the steel/iron-ore businesses over next two quarters.
Management hopes to complete demerger process by 2024.
Estimates fiscal 2025 dividend at Rs 54 per share.

Citi On Bajaj Finance

Citi maintains 'buy' with a target price Rs 8,675 apiece, an upside of 19% from the previous close.
Earnings in line with forecast despite being impacted by 4% due to regulatory restrictions.
Trims fiscal 2025 guidance on moderation in net interest margin and elevated credit cost.
Pivot towards secured assets and funding cost peaking to impact the NIM.
Building in 30 bps NIM compression.
Credit cost of 1.7–1.8% and 26–27% AUM growth.
Cuts earnings estimates by 7% each for fiscals 2025 and 2026.

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Citi On Tata Steel

Citi reiterated its 'sell' rating on the company, with a target price of Rs 115 per share.
The company intends to invest £1.25 billion in the Port Talbot furnace.
The U.K. government will fund about £500 million.
To close both blast furnaces by the end of June 2024 and the end of Sept. 2024
Believes Tata Steel will go through with its plan.
There could be up to 2,800 job losses as a result of the transition.

Morgan Stanlay On Nestle India

The brokerage has an 'underweight' rating with a target price of Rs 1,990 apiece (28% downside from its previous close).
Nestle's earnings were ahead of their consensus estimates by 9-10%.
Sees headwinds to growth and margins in FY25.
Believes the two new business initiatives announced are positive.
Milk, coffee and wheat/flour cumulatively account for ~60% of Nestle’s raw material basket.