Britannia Industries
Nomura has issued a Neutral call on Britannia, with a target price of Rs 5,800 per share. The company posted another quarter of weaker-than-expected results.
Morgan Stanley has an Equal-weight call on Britannia, targeting Rs 5,424 per share. The company missed expectations in all areas in Q2 as inflation impacted both demand and profits. Morgan Stanley had earlier expected revenue growth to match volume growth by Q3, but now sees a downside risk to this guidance.
Goldman Sachs maintains a Neutral rating for Britannia with a target price of Rs 5,350. Q2 performance was below expectations with high-single-digit volume growth but lower revenue growth. EBITDA margins declined, and input cost pressures are expected to increase in the second half of FY25.
Morgan Stanley India Strategy: Rising domestic equity savings are supporting the bullish market, with Indian households accumulating $9.7 trillion in wealth over the past decade. India is experiencing a positive wealth shock with significant macro and market implications. Short-term market pressure exists due to growth concerns. Sector strategy: Overweight on Financials, Technology, Consumer Discretionary, and Industrials; underweight on other sectors.
Goldman Sachs on Consumption: Urban slowdown, but rural remains resilient. Stocks like Godrej Consumer, Marico, Pidilite, Titan, and ITC are well-positioned for growth in H2FY25.
Jubilant FoodWorks
Morgan Stanley has an Equal-weight rating for Jubilant FoodWorks, with a target of Rs 620 per share. Demand trends are still weak, but initiatives are showing signs of growth.
Citi recommends a Buy with a target of Rs 700. Operational performance improved with a like-for-like (LFL) growth of 2.8% overall and 11.4% in deliveries, though dine-in sales were weak.
Jefferies issues a Buy call with a target of Rs 880. Despite challenges, the company showed positive same-store sales growth (SSSG), with growth in delivery and weaker dine-in performance.
CLSA rates Jubilant FoodWorks as Underperform, targeting Rs 445. Domino’s sales per store declined by 1.1% YoY, and the shift from dine-in to delivery is hurting margins. CLSA expects faster SSSG in Q3 but has cut earnings estimates by 17-32% for FY25-27.
Shree Cement
Morgan Stanley rates Shree Cement Underweight with a target price of Rs 24,200. They note frequent strategy changes, now prioritizing price over volume.
Jefferies holds a Buy call but has cut the target to Rs 28,400. Shree Cement reported slightly better EBITDA due to better realization, though frequent strategy shifts are seen as confusing.
CLSA has a Hold rating with a target reduced to Rs 25,600. Q2 EBITDA was below expectations due to weak volumes, and the company likely lost market share in key areas.
Asian Paints
Nomura gives a Neutral rating with a target of Rs 2,500. They report a cautious outlook, expecting single-digit volume growth and a margin range of 18-20% over the coming years.
Morgan Stanley holds an Equal-weight rating, cutting the target to Rs 2,358. Management is less optimistic about short-term demand, lowering the FY25 volume growth outlook to single digits.
ICICI Bank
Morgan Stanley rates ICICI Bank Overweight, raising the target to Rs 1,650. The bank remains their top pick due to its strong performance in funding and underwriting. They expect continued outperformance.
Hindalco
JPMorgan maintains an Overweight rating with a target of Rs 735, highlighting a strong Q2 performance in India with no major negatives in the results.
Investec gives a Buy call with a target of Rs 860 and awaits further details on capital expenditure. Hindalco’s India business is positioned well in terms of bauxite leases.
CLSA rates Hindalco as Buy with a target of Rs 800, reporting an EBITDA of Rs 4,300 crore, 35% above expectations, with rising aluminum EBITDA per ton.
UPL
HSBC has a Buy rating on UPL, cutting the target to Rs 680. They believe the recent sharp stock correction is an overreaction and expect further improvement in H2. UPL’s rights issue and other initiatives should help reduce debt.
Ramco Cements
Jefferies has an Underperform rating with a target cut to Rs 680. Q2 EBITDA was better than expected due to lower costs, but volume dropped by 3% YoY and pricing declined by 5% QoQ. The company’s leverage remains high.
EPL
Nomura issues a Buy call with a target of Rs 290. Q2 results were above estimates with a YoY sales growth of 8.4%. The company has maintained its double-digit revenue growth guidance for FY25.
L&T Finance
HSBC gives a Buy rating with a target of Rs 180. L&T Finance aims to increase fee-generating products and automation across most business lines. They are targeting a 2.8-3.0% ROA by FY26 with an AUM growth rate of 20-25%.
Healthcare Global
Goldman Sachs maintains a Buy rating and has raised the target to Rs 550. They see an accelerated growth and margin expansion story ahead, noting that the stock looks attractive at 11x FY26 for ~25% EBITDA CAGR over FY24-27.
LIC
JPMorgan upgrades LIC to Overweight from Underweight and raises the target to Rs 1,075. They cite strong VNB growth from an improved product mix, with revised VNB forecasts for FY25/26 up by 9%/11%.
NMDC
JPMorgan maintains an Underweight rating with a target of Rs 210. Q2 results saw an EBITDA miss due to inventory issues and higher costs, though they expect a slight negative reaction in share prices.
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