We have collated a list of recommendations from top brokerage firms from ETNow:
UBS on Eicher Motors: Buy | Target: Rs 5,000
UBS has upgraded Eicher Motors to ‘Buy’ from ‘Neutral’ and hiked the target price to Rs 5,000 from Rs 4,300. It expects Royal Enfield’s upcoming 450cc platform launch to address competition and growth concerns.
In its view, the company is found wanting on multiple fronts including its strength in RE’s addressable market, lacklustre response to competition and company’ strong customer connect.
UBS sees the start of a multi-year upgrade cycle among the existing customers while expecting 10% domestic volume CAGR in FY24-26 for RE versus the industry’s 6-7%.
The stock is trading at a 20% discount to Bajaj Auto’s 1-year forward PE, it noted calling the current risk-reward compelling, especially since RE remains insulated from electrification risk.
Jefferies on Syrma SGS: Buy | Target: Rs 640
Jefferies has initiated a buy on Syrma SGS for a price target of Rs 640. The EMS company will be a beneficiary of 35%+ CAGR growth in the industry helped by China+1 strategy.
Jefferies on Kaynes Technology: Hold | Target: Rs 2,900
Jefferies initiates coverage on Kaynes with Hold rating and a price target of Rs 2,900. Kaynes is the only EMS player to foray into OSAT and PCB production – backward integrated, the US brokerage said.
Over FY 2024-26, Kaynes posted EPS CAGR at 55-60%, with ROCE expansion. Over FY24-26e, the Indian EMS industry is set to post +35% CAGR, led by China+1 and lower labour cost, Jefferies said. While the business model remains niche, punchy valuation calls for a ‘Hold’ rating on the counter.
Nomura on OMCs
BPCL: Buy| Target: Rs 735
The Japanese brokerage has maintained a ‘Buy’ on the counter and hiked the target price to Rs 735 from Rs 455.
HPCL: Buy | Target: Rs 570
Nomura has upgraded the sock to ‘Buy’ from ‘Neutral’ while raising its target price to Rs 570 from Rs 305.
IOCL: Buy | Target: 195
IOCL has upgraded the stock to ‘Buy’ from ‘Neutral’ and hiked the target price to Rs 195 from Rs 105.
In its view, the overhang in OMC stocks is done and dusted while the refining outlook remains healthy. In its view, the daily revisions will likely resume post the elections. Marketing margins are likely to remain at normative levels in FY25.
B&K on Hindustan Foods: Buy | Target: Rs 678
Brokerage B&K has initiated a coverage on Hindustan Foods with a ‘Buy’ and a target price of Rs 678. Calling it the largest consumer contract manufacturer in India, B&K said that the company has adopted organic and inorganic routes to scale up. Strong tailwinds are in place and this brokerage expects revenue/EBITDA/PAT to grow 23%/28%/37% over FY23-26. Despite strong growth, the company is expected to see net debt to equity declining to 0.4x from 1.2x.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)