Analyst Calls: BHEL, Havells, Bajaj Finance, Infosys


The domestic stock market on Friday showed early signs of a possible breakout from its consolidation range. And Nifty futures on Singapore traded 39.50 points higher this morning, signalling a good start for Dalal Street.

As you head for the day’s trade, here is a compilation of overnight analyst calls on various stocks.

Emkay Global has upgraded rating on Bharat Heavy Electricals to buy from hold with a revised target price of Rs 62. Power capex would pick up from here but not to the extent of the 2004-11 cycle, BHELNSE 0.49 % provides around 4.2 per cent dividend yield besides being an inexpensive play on the eventual power capex revival, said the brokerage. The main downside risk cited by the brokerage is that a continued slowdown in new orders, execution and write-offs on receivables can be expected. Shares of BHEL ended up 2.20 per cent at Rs 51.15 on Thursday.

• Haitong Securities initiated coverage on HavellsNSE 0.97 % India with a neutral rating and set a target price of Rs 620. The brokerage expects the company to report a strong net profit growth of 18.5 per cent CAGR between FY19-FY22. Havells is looking to deepen its distribution, with focus on smaller towns, and the company plans to ramp up its durable business, given that business synergies and strong demand drivers are now in place. Shares of Havells ended up 2.5 per cent at Rs 652 on Thursday.

• Motilal Oswal maintained neutral rating on Bajaj Finance, with a target price of Rs 3,550. The company’s AUM growth might slow down to 30 per cent YoY in FY20, cited the brokerage. The company doubled its non-core fee income YoY to Rs 1700 crore in FY19, the brokerage said. As a percentage of AUM, fee income was up 60 bps YoY to 1.7 per cent, while most other NBFCs are around –1 per cent, said the brokerage. Shares of Bajaj FinanceNSE 2.35 % ended up 1.3 per cent at Rs 3291.4 on Thursday.

• CLSA has maintained buy rating on Cadila Healthcare with a target price of Rs 285. Over the past few years, Cadila Health has taken several initiatives to strengthen its India and EM portfolio with an aim to reduce dependence on the US, said CLSA. CLSA expects results to come from FY21 and set the long-term earnings outlook for the company. Shares of Cadila Healthcare ended up 2.36 per cent at Rs 235.90 on Thursday.

• Kotak Institutional Equities maintained its add rating on InfosysNSE 0.80 % and increased fair value to Rs 850 from Rs 775. The brokerage said the confidence on growth emanates from large deal ramp-up and improved positioning in clients/ verticals. A possible fear is Infosys may be sacrificing growth for margin expansion over the next 3 quarters. It increased payout ratio to 85 per cent of FCF cumulatively over 5 years starting FY 2020. Crosscurrency headwind from strengthening of the dollar against other currencies will have an impact of 2-4 per cent rise in FY20-FY22 estimated EPS. Shares of Infosys ended up 1.60 per cent to Rs 834.20 on Thursday.