Brokerage Views: Jefferies On GAIL, Citi On Ambuja Cements And More

We at NDTV Profit are tracking what the brokerages are putting out on specific stocks on the go. Here are all the top calls you need to know this Monday morning.

<div class="paragraphs"><p>(Source: Envato)&nbsp;</p></div>
(Source: Envato) 

Jefferies and Citi Research has on April 1 released interesting stock calls on a range of sectors to kick off the new fiscal year.

Jefferies maintained an 'underperform' rating on the state-owned gas transmission and marketing company Gail (India) Ltd. While Citi has reiterated a 'buy' on Ambuja Cements Ltd.

Benchmark equity indices pared some gains in the last hour of Thursday's session but still managed to close the last week of the financial year over 1% higher.

The NSE Nifty 50 ended 219.85 points, or 0.99%, higher at 22,343.50, while the S&P BSE Sensex closed 639.16 points up, or 0.88%, at 73,635.48.

We at NDTV Profit are tracking what the brokerages are putting out on specific stocks on the go. Here are all the top calls you need to know this Monday morning.

Jefferies On Adani Enterprises

  • Jefferies maintained 'buy' on Adani Enterprises and kept target price unchanged at Rs 3,800.

  • Commissioned first phase of copper unit in Mundra.

  • Once fully commissioned, this will be the largest custom copper smelter in the world.

  • Suggests groups ability to plan and execute large scale projects.

  • Copper site is located in Mundra, enabling synergies.

  • Product portfolio also includes other value added products.

Antique Initiates Coverage On Mamaearth

  • Antique initiates coverage on Mamaearth-parent Honasa Consumer with a 'hold' rating and target price of Rs 400.

  • Revenue growth, improving profit materially could be a challenge in medium term.

  • Appreciate ability to create brands with innovative product launches.

  • Mamaearth has reached a sizeable scale.

  • Large part of future growth will have to be driven by retail expansion.

  • Continue aggressive advertising and promotional spends restricting profitability

  • Expect sales CAGR of 25% over FY23–26.

  • Ascribe a valuation multiple of 60x FY26E.

ICICI Securities Initiates Coverage On Dynamatic Technologies

  • ICICI Securities assigned 'buy' rating on Dynamatic Technologies with target price of Rs 10,250, implying a 37% upside

  • Aerospace to be the primary growth vector.

  • Hydraulics and metallurgy divisions are turning a fresh leaf.

  • Capex has peaked out, debt to fall, returns to improve.

  • Ebitda CAGR of 19% and Ebitda margin of 17-18% through to FY27.

  • Target price based on 45x FY26E EPS.

CLSA's Weekly India Strategy

  • Nifty outperformed peers; government acts to boost rural demand.

  • Nifty did well on back of recovery of heavyweight sectors like oil & gas and FMCG.

  • FIIs were net buyers in Indian equities and debt market in March.

  • T+0 settlement system launched; govt hikes MGNREGA wages by 3%-11%.

  • Bull-bear index in neutral zone.

  • CLSA India portfolio outperformed the Nifty by 0.6 percentage points during the week.

Morgan Stanley On IT Sector

  • Bottoming out of revenue growth, pace of recovery lower than previous estimates.

  • Expect recovery to be slower than previous phases.

  • Investor positionings still light, relative valuations close to five-year averages.

  • Expect most large caps to register revenue CAGR of 7-8% over F24-26.

  • EBIT margins to improve YoY, EPS growth FY24-26 to be higher than FY22-24.

  • Overweight: TCS, Infosys, HCL Technologies and Coforge.

  • Equal Weight: LTIMindtree

  • Underweight: Tata Elxsi, L&T Technology Services, Wipro, Tech Mahindra

Jefferies On GAIL

  • The brokerage has maintained an 'underperform' rating with a target price of Rs 150 per share.

  • The Petroleum and Natural Gas Regulatory Board's newly notified unified tariffs remain unchanged at $81.13 per metric million British thermal unit.

  • New tariffs, effective June, will include newly commissioned pipelines.

  • The brokerage's estimates remain unchanged, and it projects muted earnings growth over FY24–26.

  • Risk reward remains unfavourable.

Citi On Ambuja Cements

  • Citi has maintained a 'buy' on the cement manufacturer with a target price of Rs 645 apiece.

  • About 44% of promoter warrants converted inspire confidence.

  • The brokerages allow the company to benefit from cost efficiencies.

  • It expects a favourable swap ratio for Ambuja, should there be a merger with ACC.

  • Citi expects Rs 4000 to 5000 crore per annum for the next few years.

Motilal Oswal On ICICI Lombard

  • The brokerage retained the 'buy' on the company with a target price of Rs 2,000 per share.

  • It expects the technology initiatives of the company to drive long-term efficiencies.

  • It aspires to increase the indemnity health market share from 3% to 4.5% over three to four years.

  • About 9.5–11% of market share is in the motor insurance segment.

  • Efficiencies from tech investments and scale benefits boost profitability.

Morgan Stanley On PNB Housing Finance

  • The brokerage retained 'overweight' rating and target price of Rs 970 for on PNB Housing Finance.

  • Both CARE and ICRA have revised rating for the company to AA+ with stable outlook from AA (positive outlook).

  • Morgan Stanley sees improved asset quality, strengthen capital position.

  • The credit rating positive for growth and profitability

  • Improves availability and cost of borrowing

  • Stock has underperformed, see a good entry point

  • Valuation is attractive at 1x FY25E PBV, 9x PE

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