Citi opened a 90-day positive catalyst watch on Indus Towers Ltd. Nomura predicted a 25 basis points rate cut in the upcoming RBI MPC meet. CLSA remains bullish on Persistent Systems Ltd., a top pick in the IT sector.
Bernstein shares its take on Zomato versus Swiggy, and CLSA maintains outperform on entertainment bigwigs PVR Inox and Zee Entertainment.
NDTV Profit tracks what the brokerages are putting out on stocks and sectors. Here are all the top calls from analysts you need to know about on Thursday.
Citi On Indus Towers
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The brokerage has opened a 90-day positive catalyst watch.
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Maintains a target price of Rs 485 apiece on the stock, implying a potential 35% upside.
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Vodafone plans to sell its remaining 3% stake in Indus Towers for Rs 27-28 billion.
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Expect Rs 19-20 billion to be infused by Vodafone PLC into Vodafone Idea to clear past dues to Indus Towers.
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Indus Towers could declare a dividend of Rs 7 per share due to repayments from Vodafone Idea.
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The dividend could be 6% in the fiscal year 2026-27, making it a compelling investment proposition.
Emkay On Cholamandalam Investment And Finance Co
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Assets Under Management growth is expected to moderate to around 25% in the fiscal 2025.
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Growth is anticipated to slow due to a large base, muted demand in the auto sector, and prudent underwriting.
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The company is confident of managing credit costs at approximately 1.3% in fiscal 2025.
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Slightly elevated operating expenses are expected.
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The Profit Before Tax Return on Assets target of 3.5% will likely be missed in fiscal 2025.
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Medium-term growth is expected to be around 20-25%.
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Chola Investment is comfortable with its capital position, with plans to raise Rs 40 billion in tier-2 capital during fiscal 2025.
Nomura On RBI MPC Meeting
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Maintained an out-of-consensus call for a 25bps repo rate cut to 6.25%.
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The rate cut expectation contrasts with the consensus view of no change in the stance on Dec. 6.
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The rate cut is expected due to weaker growth and a benign inflation outlook.
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We continue to expect a total of 100bps in cuts by mid-2025, with a terminal rate of 5.50%.
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Q2 GDP in fiscal 2025’s growth dropped sharply to 5.4%, highlighting domestic demand weakness.
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A move to neutral policy rates will no longer be sufficient.
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Rate cuts are unlikely to have a significant impact on the currency.
CLSA On Persistent Systems
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Maintained ‘outperform’ with a target price of Rs 8,462 (earlier Rs 6,154), implying a potential upside of 41%.
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Strong market positioning and exposure to fast-growing data analytics.
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Increased revenue and margin forecasts due to various growth levers.
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Expects a 27% Earnings Per Share Compound Annual Growth Rate over the next two fiscals.
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Persistent remains a top pick in IT coverage.
Morgan Stanley On Hero MotoCorp
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Retained ‘underweight’ with target price of Rs 4,110 per share, implying an 11% downside.
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Hero MotoCorp launched a cheaper variant of its electric scooter, Vida V2.
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Sustained market share gains are key to potential re-rating.
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Affordable variants with a 2.2 kWh battery launched at Rs 96,000, in line with peers.
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A mass-market variant with a 3.4 kWh battery priced at Rs 1.15 lakh, at the midpoint of the segment.
Jefferies On Shriram Finance
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Maintained ‘buy’ with a price target of Rs 3,670, implying a 17% upside.
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Steady growth outlook; asset quality remains strong, continuing to be among top picks.
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Seeing steady credit demand; higher used vehicle prices provide support.
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Projecting AUM growth of 18% in the financial year 2025.
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Industry stress inched up in autos in the second quarter, but this may ease in the fourth quarter.
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Asset quality has held up well, and provision levels remain healthy.
CLSA On Oil And Gas
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A significant quarter-on-quarter cut in margins for city gas players is likely in the third quarter.
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Forecasts for a harsh winter are pushing global gas prices higher.
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The CNG price hike is insufficient to offset higher gas costs.
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Expects a large QoQ decline in Ebitda margins for IGL and MGL.
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The discount of CNG to petrol/diesel remains healthy.
JPMorgan On Adani Group
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Overweight on Adani Ports bonds.
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Initiated an ‘overweight’ rating on ADSEZ 32s, moving ADSEZ 41s to ‘neutral’ from ‘overweight’.
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Maintained a ‘neutral’ stance on ADANEM and Adani Green RG bonds.
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Group companies’ liquidity needs appear manageable, with Adani Green in focus.
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Group’s bond spreads have stabilised, widening by about 100-200 basis points.
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Prefers some short-end bonds. Moved ADTIN 2026 bonds to overweight.
CLSA On Media
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PVR Inox: Maintained ‘outperform’ with a target price of Rs 2,450, implying a 53% upside.
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Zee: Maintained ‘outperform’ with a target price of Rs 170, implying a 21% upside.
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The media sector is experiencing a continuing soft advertising environment.
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The advertising industry, led by FMCG, is facing headwinds.
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India’s box office collections saw a strong rebound, driven by Hindi movies.
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PVR Inox’s re-release strategy has been successful, contributing to approximately 6% of admissions in the second quarter.
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Zee’s valuations are attractive, positioning the company to capitalise on advertising recovery.
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PVR Inox stands to benefit from improvements in content and occupancy.
Bernstein On Zomato Versus Swiggy
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Rates Zomato as outperform with a target price of Rs 335 per share, implying a 20% upside.
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Zomato has a wider city presence compared to Swiggy.
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Zomato has deeper penetration in tier 2+ cities, driving higher monthly transacting users.
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Swiggy has a higher frequency of users.
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Blinkit has 1.5 times higher monthly transacting users than Instamart.
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Gross order value per restaurant is higher for Zomato.
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Swiggy has a stickier customer base than Zomato.
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