Stock Recommendations Today: DMart, BSE, Asian Paints, Hyundai Motor India On Brokerages’ Radar NDTV Profit Desk NDTV Profit

DMart operator Avenue Supermarts Ltd.’s third quarter results have made brokerages turn cautious on the stock. They expect margins will continue to be under pressure amid the high competition and management’s focus on market share.

Macquarie has flagged concerns on the paints sector and has cut target price for top players like Asian Paints Ltd., Kansai Nerolac Ltd. and Berger Paints Ltd.

NDTV Profit tracks what analysts are saying about various stocks and sectors. Here are the analyst calls to keep an eye out for on Tuesday:

Brokerages On Avenue Supermarts

Citi Research

• Citi maintains a ‘sell’ rating with a target price of Rs 3,350 per share, a potential 9% downside to the previous close.

• Key reasons for margin contraction include decline in general merchandise and apparel mix (-30 basis point YoY), increased discounting and negative operating leverage.

• Ebitda growth has underperformed revenue growth in nine of the last 10 quarters.

• Valuation concerns: Risk-reward appears unfavourable at 69 times the fiscal 2026 P/E estimate.

• Recommendation: Wait for a better entry point or valuation.

Nuvama

• Nuvama maintains a ‘hold’ rating with a revised target price of Rs 4,212 apiece (earlier Rs 5,040), implying a 13% upside.

• Expects DMart’s margins to remain under pressure due to high competition.

• Revised estimates for fiscal 2025 and 2026:

  • Revenue trimmed by 0.5% and 2.1%, respectively.

  • Net profit trimmed by 11% and 17.4%, respectively.

Macquarie On Paints

• Asian Paints: Maintained ‘outperform’, but cut target price to Rs 2,650 (from Rs 3,750).

• Kansai Nerolac: Maintained ‘neutral’, but cut target price to Rs 255 (from Rs 300).

• Berger Paints: Retained ‘underperform’, but cut target price to Rs 400 (from Rs 455).

• Pidilite: Maintained ‘underperform’, but cut target price to Rs 2,600 (from Rs 2,900).

• Key concerns:

• Sharper-than-expected demand weakness drives earnings cuts.

• Uncertainty from the proposed sale of Akzo’s decorative business.

• Limited impact expected from Grasim’s entry into the market.

• View: Income growth required for demand recovery likely back-ended in calendar year 2025.

Goldman Sachs On BSE

• Goldman Sachs initiates coverage on BSE with a ‘neutral’ rating and a target price of Rs 5,060 per share, a 1% potential upside.

• Key drivers include:

• Second-largest stock exchange poised to benefit from strong growth tailwinds.

• Robust nominal growth in listed earnings expected to boost trading revenues.

• Retail participation and derivatives to provide structural long-term growth opportunities.

CLSA On Hyundai Motor India

• CLSA initiated coverage on Hyundai Motor India with a target price of Rs 2,155, implying an upside of 21%.

• Currently experiencing a period of low growth amid elevated capacity utilisation.

• Among the few foreign carmakers to survive domestic competition for over two decades.

• Key growth drivers include loss of market share expected to stabilise with new plants becoming operational.

• Major model launches in fiscal 2026 and capacity additions starting the following year.

• Strengths include superior unit economics and incremental ROCE.

• Valuation: Target price implies 24 times fiscal 2027 P/E, aligned with Maruti’s valuation.

Citi On Insurance

Individual APE growth for private insurers moderated to 11% YoY in December (from 15% YoY in November). In the third quarter:

• SBI Life’s Individual APE market share rose by 155 bps YoY to 22.1%.

• LIC’s Individual APE market share declined by 520 bps YoY.

• LIC’s business has not recovered despite introducing new products in October 2024.

• Value of New Business expected to vary significantly across companies (-35% to +20%).

Key Points to Monitor:

• Discussions with regulators on limiting distribution volumes in certain partnerships.

• Full impact of new surrender norms on VNB margins.

• Changes in product mix during the quarter.

Emkay On Life Insurance

• The life insurance industry reported muted 4.8% retail APE growth in December.

• While LIC saw 51% decline in Group APE, driving a 31% decline in the industry’s Group APE.

• SBI Life emerged as the fastest growing private player in December, reporting 16% Retail APE growth.

• SBI Life clocked market share of 27% materially above LIC’s 22% market share.

• Overall, December growth trends were impacted by regulatory uncertainties regarding the banca channel.

• Implementation of the new surrender regulations leading to an impact on the lower ticket-size policies.

Jefferies’ View On SMIDs In 2025

• Top small and midcap picks: Amber Enterprises, Polycab India, Supreme Industries, V Guard.

• SMIDs outperformed in 2024, with stronger earnings expectation as key driver.

• Brokerage staying selective, bullish on electronics manufacturing services, 2025 capex recovery, housing themes.

• Like Amber Enterprises due to margin accretive component diversification.

• Likes Polycab India as a play on capex.

• V Guard could have further upside from Sunflame synergies.

• Supreme Industries on holistic play on plumbing, agriculture, housing, capex.

Nuvama On CESC

• Nuvama maintains ‘hold’ on CESC and cuts target price to Rs 175 from Rs 190 earlier, a potential 8% upside.

• Current market price factors in tariff hike benefits, timely renewable execution, regulatory asset recovery.

• Third quarter results were weak, missing estimates by 26%.

• Earnings hurt by widening Malegaon losses, lower regulatory income.

• Higher visibility of CESC’s renewable energy transition.

• Company aims to add 3.2 GW of renewables by fiscal 2029.

Emkay On India Strategy: 2025 Outlook

• Expects markets to remain weak during January-March, stabilise from second quarter of calendar year 2025.

• Key themes: Consumption slowdown reversal by second half of the year.

• FPI selling should abate by second quarter of CY25.

• Capex to track overall GDP from here.

• SMIDs to deliver stronger returns versus Nifty on expected turnaround.

Top Ideas for 2025 : Lupin Ltd., Zomato Ltd., Tata Motors Ltd., IndusInd Bank Ltd., Escorts Kubota Ltd., One97 Communications Ltd., StoveKraft Ltd., Metropolis Healthcare Ltd., Quess Corp.

Model Portfolio Changes

• Additions: TVS Motor, Page Industries, Lupin, One97 Communications.

• Increased weight: BPCL, Larsen and Toubro, TCS, Infosys, Shriram Finance.

• Trim: Bharti Airtel, Reliance Industries, Infosys, Godrej Consumer Products, National Aluminium.

• Exit: Hero MotoCorp, Ambuja Cements, HCL Tech, Axis Bank, HDFC Life Insurance.

. Read more on Markets by NDTV Profit.Goldman Sachs, Citi and Nuvama share their calls on various stocks on Monday.  Read MoreMarkets, Business, Notifications 

​NDTV Profit