Vishal Mega Mart Ltd., Polycab India Ltd., and BSE Ltd. are among the top stocks on brokerages’ radar on Monday, along with other wire and cable stocks.

Brokerages have also done a deep dive on India’s GDP data with the macro steadily recovering. The gross domestic product grew 6.2% over a year earlier in the October-December quarter.

Kotak Securities initiated coverage on Vishal Mega Mart, while Morgan Stanley reported on auto sales data.

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

Kotak On Vishal Mega Mart

  • Initiated with an ‘add’ rating on the stock and a target price of Rs 110 apiece.

  • Large and diversified retailer with a pan-India network of 668 stores.

  • Significant total addressable market, driven by Vishal Mega Mart’s low-priced private-label brands.

  • Forecasts 17% revenue and 24% profit after tax compound annual growth rate over the fiscals through March 2028.

  • Low-cost, good-quality apparel and private-label merchandise support stable margins.

  • Asset-light business model ensures strong return ratios.

BofA On GDP Data

  • Fourth-quarter fiscal 2024 gross domestic product review indicates a shallow recovery, leading to a downward revision in forecasts.

  • GDP modestly recovered to 6.2% year-on-year on an upgraded base.

  • Revised fiscal 2025 GDP growth estimate to 6.3% from 6.5% earlier and fiscal 2026 estimate to 6.5% from 7% earlier.

  • Supply-side indicators exhibit positive momentum.

  • Reserve Bank of India rate-cutting cycle expected to continue.

Nomura On GDP

  • Higher headline growth but underlying details remain weak.

  • Growth is recovering but continues to trend downward.

  • Forecasts GDP growth of 6.5% in the first quarter and 6% in the fiscal year ending March 2026.

  • Anticipates an additional 75 basis points in rate cuts.

Jefferies On Polycab

  • Retained a ‘buy’ rating on the stock and lowered target price to Rs 6,485 apiece from Rs 7,700.

  • Stock declined 20% over the past two days, following UltraTech’s planned entry into the cables and wires segment.

  • Currently trades at 27 times fiscal 2026 estimated earnings, lower than its historical average.

  • No impact anticipated over the fiscals through March 2027, with projected revenue and profit after tax compound annual growth rates of 22% and 28%, respectively.

  • Export market presents a growing opportunity, supported by diversification beyond China.

  • Medium-term outlook remains strong. However, factoring in current market correction and increasing competition post-2027, target price-to-earnings ratio is reduced by approximately 15% to 32 times.

Goldman Sachs On BSE

  • Retained a ‘neutral’ rating on the stock and lowered target price to Rs 4,880 apiece from Rs 5,650.

  • Reduction in industry options trading penetration expected.

  • Securities and Exchange Board of India consultation paper aims to curb undue volatility in equity markets, which is unfavourable for exchanges.

  • Options trading contributes approximately 50% of BSE’s top-line revenue.

  • BSE shares largely reflect the risk posed to industry volumes due to the proposed regulatory changes.

  • Final outcome remains uncertain as the market did not anticipate this regulatory development.

Morgan Stanley On Automobile Sales

  • Retail sales trends remained weak during the month.

  • Passenger vehicles and two-wheelers witnessed year-on-year declines of approximately 6% to 9%.

  • In wholesale terms, Eicher Motors Ltd., TVS Motor Co., and Mahindra & Mahindra Ltd. outperformed.

  • Maruti Suzuki India Ltd. and Hero MotoCorp Ltd. met expectations, while Tata Motors Ltd. underperformed relative to estimates.

  • Electric passenger vehicle penetration improved by 50 basis points month-on-month to 2.9%.

  • Tata Motors’ market share declined by 3% month-on-month to 42%, while MG Motor’s market share dropped by 2% to 36% in the electric passenger vehicle segment.

Investec On Cables And Wires

  • Retained a ‘buy’ rating on Havells India Ltd. and lowered the target price to Rs 1,680 from Rs 1,850.

  • Upgraded Polycab to ‘hold’ from ‘sell’ with a target price of Rs 5,420.

  • Maintained a ‘buy’ rating on V-Guard and reduced the target price to Rs 475 from Rs 530.

  • Notes that the best days for wire and cable companies may be behind, with peak utilisation and rising average annual capital expenditure by 2.5 times over fiscals through March 2027.

  • Expects a decline in asset turnover and return on invested capital, with potential pricing pressure in the business-to-business segment.

  • Highlights that UltraTech’s entry, backed by its distribution reach and contractor network, adds further competition.

  • Forecasts revenue growth for wire and cable incumbents to slow down by four percentage points annually to 12-13% over fiscals through March 2031.

  • Anticipates margin erosion in the sector.

  • Given UltraTech’s initial focus on domestic wires, the brokerage lowered valuation multiples for Havells India and V-Guard.

  • With a 36% year-to-date share price correction in Polycab, considers the risk-reward balance reasonable now.

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