The domestic stock market on Thursday showed early signs of a possible breakout from its consolidation range. And Nifty futures on Singapore traded flat this morning, signalling a tepid start for Dalal Street.
As you head for the day’s trade, here is a compilation of overnight analyst calls on various stocks.
Edelweiss Securities has downgraded Bharat Heavy Electricals to reduce from buy and cut target price to Rs 60 from Rs 85. Despite dominant market share and stabilising OPMs, BHELNSE -0.66 % continues to face long-term growth challenges thrown up by emergence of renewable power (largely solar) and much weaker thermal power demand, said Edelweiss. BHEL is unlikely to generate revenue growth beyond 6–8 per cent over five years, which would limit its returns structure, said Edelweiss. The stock ended up 1.7 per cent at Rs 75.20 on Wednesday.
ICICI Securities has maintained buy rating on Jubilant FoodWorks with a target price of Rs 1,600. Food aggregators’ ramp-up has impacted the causal dine-in segment including the dine-in business for Jubilant Foodworks’ in the top-10 cities, said ICICI Securities. The company has introduced a new store format, designed by Fitch, to arrest this softening growth through enhanced customer experience at its stores, said ICICI Securities. The stock ended down 2 per cent at Rs 1,249.50 on Wednesday.
CLSA has maintained buy rating on Sun Pharmaceutical Industries with a target price of Rs 520. A de-focus on certain therapies and tail brands is dragging the overall growth for Sun, said CLSA. This should, however, lead to improved profitability that is reflected in higher field force productivity, said CLSA. Pertinently, despite slow growth, Sun’s India business ex-Ranbaxy has witnessed continued margin expansion, said CLSA. The stock ended up 3.6 per cent at Rs 399.30 on Wednesday.
Investec Securities has maintained buy rating on Supreme IndustriesNSE 4.06 % and revised target price to Rs 1,313 from Rs 1,315. Supreme enjoys a superior return ratio profile, consistent dividend pay-outs, efficient working capital cycle and highest cash conversion, said Investec. Supreme Industries trades at 23.5 times FY21 PE and offers 13 per cent EPS CAGR FY19-21, 2.6 per cent FCF yield (FY21), which is an attractive proposition, said Investec. The stock ended up 1.9 per cent at Rs 1,072.7 ..
Kotak Institutional Equities has maintained reduce rating on NMDCNSE 0.62 % with a fair value of Rs 106. NMDC is well placed in the near-term with triggers for a price hike, the brokerage said. However it does not expect higher prices to sustain as seaborne prices are likely to correct in second half of FY20, the brokerage said. It expects a majority of merchant mines to be lost to steel producers at the mine auctions in 2020. Shrinking domestic merchant iron ore market may reduce pricing power of miners, said Kotak. The stock ended up 1.35 per cent at Rs 112.40 on Wednesday.