HSBC has reiterated its positive stance on Titagarh Rail Systems, highlighting strong opportunities despite execution challenges, while Morgan Stanley provided a cautious outlook on IndusInd Bank, citing concerns over weakening trends in the microfinance segment.
Meanwhile, Axis Capital remains optimistic about Hindustan Unilever (HUL).
We have collated a list of recommendations from top brokerage firms from ETNow and other sources:
HSBC on Titagarh Rail System: Buy | Target Rs 1,425 | LTP Rs 1,205 | Upside 18%
HSBC has maintained a “Buy” rating on Titagarh while revising its target price downward to Rs 1,425 from Rs 1,980. The stock’s current market price is Rs 1,205, indicating a potential upside of 18%.
With state elections concluded, the awarding of metro rolling stock contracts has resumed, presenting a robust opportunity pipeline for the company.However, the execution of ongoing metro and Vande Bharat orders has been slower than initially anticipated, prompting a downward revision of estimates.Consequently, HSBC has reduced its target price based on these lower estimates and a revised valuation multiple.
Morgan Stanley on IndusInd Bank: Equal-weight | Target Rs 1,150 | LTP Rs 996 | Upside 15%
Morgan Stanley has maintained an “Equal-weight” rating on IndusInd Bank while lowering its target price to Rs 1,150 from Rs 1,400. With the stock currently trading at Rs 996, this represents an upside potential of 15%.
The stock has dropped 30% since the earnings announcement, primarily due to concerns over the asset quality of its microfinance (MFI) portfolio.
Weakening MFI trends have further led to downward revisions in earnings per share (EPS) estimates.
While the overall risk-reward scenario is not unfavorable, the near-term risks remain skewed to the downside.
Morgan Stanley continues to apply a 30% bear case weight to its valuation and sees relatively better risk-reward opportunities in large private sector banks.
Axis Capital on HUL: Add | Target Rs 2,850 | LTP Rs 2,496 | Upside 14%
Axis Capital has retained its “Add” rating on Hindustan Unilever (HUL) with a target price of Rs 2,850, reflecting a 14% upside from its current market price of Rs 2,496.
The company’s near-term demand and margin outlook remains stable, supported by an extensive reach across 9 million stores, including 3 million directly serviced stores, 35 distribution centers, and over 3,500 redistributors.
HUL’s direct weighted distribution has increased to 65% from 56% in FY22, with a target of reaching 70% by FY27. The company boasts 19 brands generating over Rs 10 billion in turnover, with over 85% of its business enjoying category leadership.
In the long term, HUL aims for double-digit earnings per share (EPS) growth.
Additionally, management highlighted the strong growth prospects in the ice cream segment, which is expected to grow in double digits.
This segment also has significant potential for premiumization, given its low per-capita consumption penetration.
(With inputs from ETNow)
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)