SBI Cards and Payment Services Ltd., Adani Wilmar Ltd., Varun Beverages Ltd., Dhanuka Agritech Ltd., and Bharti Airtel Ltd. are among the top stocks on brokerages’ radar on Wednesday, along with pharmaceutical stocks.

Macquarie in its India Strategy note highlighted that relative valuation harmonisation for growth and returns outlook has shifted from extreme in October 2024 to now above par.

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

Citi on ICICI Lombard

  • Retain a ‘sell’ rating on the stock and lower the target price to Rs 1,550 from Rs 1,750.

  • Lower growth reflects near-to-medium-term cautiousness on capital gains contribution to investment income.

  • See reduced visibility on any substantial price hike in motor third-party insurance, a tepid pace of auto sales, and sustained competitive pressure in business-to-business segments.

  • Retail segments will likely continue to experience increasing competitive pressure.

  • Limited levers to improve profitability trends, which is likely to constrain investor sentiment.

Macquarie India Strategy

  • India’s relative valuation harmonisation for growth and returns outlook has shifted from extreme in October 2024 to now above par.

  • Among India’s top 500 stocks, approximately 70% have experienced at least a 20% pullback.

  • Despite a de-rating, the Nifty Mid-100 segment’s aggregate valuations remain high at nearly 30 times price-to-earnings.

  • Key headwind: Even if domestic liquidity holds, consensus earnings expectations for the fiscal years through March 2027 still need to be revised lower.

Goldman Sachs on SBI Cards

  • Retain a ‘buy’ rating on the stock with a target price of Rs 912.

  • Management expects credit costs to improve starting in the fourth quarter.

  • Various portfolio measures have been undertaken to improve asset quality.

  • Market share is stabilising for SBI Cards in credit card acquisitions.

  • Overall spending growth remains muted, though retail spending is healthy.

  • Growth will recover, though cautiously.

  • RuPay credit cards are gaining traction.

  • Margins are seeing near-term tailwinds.

  • Profitability is expected to improve next year.

Jefferies on Adani Wilmar

  • Retain a ‘buy’ rating on the stock with a target price of Rs 370.

  • Announced the acquisition of top brands.

  • Adding a margin-accretive portfolio.

  • Favors management’s strategy to expand into the packaged foods segment beyond edible oils.

  • Expect limited Ebitda accretion from the acquisition at less than 2%.

  • Believe valuations are reasonable at 18 times enterprise value to Ebitda, with the acquisition funded by internal accruals.

Jefferies on Varun Beverages

  • Retain a ‘buy’ rating on the stock with a target price of Rs 715.

  • Recent correction is mainly due to concerns over aggressive pricing, distribution, and marketing strategies by Campa (Reliance).

  • Early-stage channel checks indicate mixed feedback, with the brand mainly gaining market share from local and regional players.

  • Closely monitoring developments but find the share price correction exaggerated.

  • Believe the valuation at 45 times one-year forward price-to-earnings appears attractive in the context of growth.

  • A strong summer season is a key short-term trigger.

HSBC on Dhanuka Agritech

  • Retain a ‘buy’ rating on the stock and lower the target price to Rs 1,550 from Rs 1,700.

  • Sales momentum remains muted, but management expects a pickup in March as stocking begins for the upcoming season.

  • Import costs have risen due to depreciation in the Indian Rupee, necessitating price increases.

  • Some product prices have already been hiked.

Goldman Sachs on Prince Pipes

  • Retain a ‘neutral’ rating on the stock and lower the target price to Rs 330 from Rs 480.

  • Valuations appear reasonable following the recent correction, but an uncertain margin outlook keeps the rating neutral.

  • Achieving a 12% underlying Ebitda margin will be challenging in the near term.

  • Believe if the industry demand and pricing cycle improve, Prince Pipes could be a high-beta beneficiary.

Goldman Sachs on Pharmaceutical Sector

  • Neuland Laboratories – Retain a ‘buy’ rating and lower the target price to Rs 14,700 from Rs 15,850.

  • Syngene International – Retain a ‘buy’ rating and lower the target price to Rs 925 from Rs 1,025.

  • Torrent Pharmaceuticals – Retain a ‘buy’ rating and lower the target price to Rs 3,675 from Rs 3,925.

  • Aurobindo Pharma – Retain a ‘buy’ rating and lower the target price to Rs 1,300 from Rs 1,475.

  • Biocon – Retain a ‘neutral’ rating and lower the target price to Rs 325 from Rs 350.

  • Lupin – Retain a ‘neutral’ rating and lower the target price to Rs 1,975 from Rs 2,225.

  • Divi’s Laboratories – Retain a ‘neutral’ rating and lower the target price to Rs 5,325 from Rs 5,925.

  • Dr. Reddy’s Laboratories – Retain a ‘neutral’ rating and lower the target price to Rs 1,175 from Rs 1,300.

  • Cipla – Retain a ‘sell’ rating and lower the target price to Rs 1,325 from Rs 1,340.

  • Sun Pharmaceuticals – Retain a ‘sell’ rating and lower the target price to Rs 1,475 from Rs 1,625.

  • Laurus Labs – Retain a ‘sell’ rating with a target price of Rs 475.

  • Gland Pharma – Retain a ‘sell’ rating with a target price of Rs 1,450.

  • Stocks are now trading below historical averages.

Bernstein on Bharti Airtel

  • Retain an ‘outperform’ rating on the stock and raise the target price to Rs 1,900 from Rs 1,770.

  • Maintain a positive stance on Bharti Airtel, making it a top pick in the telecommunications sector.

  • See limited near-term risk from Starlink, as its focus remains on rural broadband services.

UBS on M&M

  • Upgrade rating to Buy from Neutral but lower the target price to Rs 3,300 from Rs 3,460.

  • Expect high single-digit volume growth in the SUV segment.

  • Tesla’s India plans are not seen as a major threat.

  • Farm equipment business expected to perform well.

  • Believe the recent share price correction due to EV-related news is an overreaction.

  • Note that domestic SUVs contribute 50% of EBIT alongside a strong tractor business.

JPMorgan on M&M Finance

  • Upgrade rating to Overweight from Underweight and raise the target price to Rs 320 from Rs 235.

  • Positions for positive rural momentum.

  • Favorable rate cycle and rural economy pickup seen as key growth drivers.

  • Diversification expected to aid disbursements.

  • Credit costs likely to rise in FY26.

  • Upcoming rights issue remains a key overhang, but its completion will be a clearing event in the near term.

Morgan Stanley on Coforge

  • Maintain ‘Overweight’ rating with a target price of Rs 11,500.

  • Signed its largest deal ever.

  • The deal could add $80-120 million in incremental revenue for FY26, contributing 5-8% growth depending on ramp-up.

  • Management previously flagged that some ongoing deal pursuits are significantly larger than past transactions.

  • Even on an annualised run rate basis, the deal size exceeds expectations.

  • This deal could pose upside risk to fiscal 2026 revenue growth estimates.

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