Brokerages initiated coverage on Himadri Speciality Chemical, Whirlpool and ICICI Prudential Life with a favourable rating. Meanwhile, research firm HSBC upgraded Gujarat Pipavav's stock rating to ‘Buy' from ‘Hold' and also raised its price target.
Here's what brokerages had to say:
Geojit On ICICI Prudential Life
- Initiated ‘Buy' with price target of Rs 450, implying a potential upside of 10.9 percent from Friday's close.
- Outlook on Indian life insurance sector remains bright.
- Indian life insurance industry is at the cusp of enormous growth.
- ICICI Life is well-positioned to capture the strong growth.
- Best play on life insurance sector.
- Expect ICICI Life to deliver 22 percent and 15 percent in return on equity and return on enterprise value in the next financial year.
- Expect new business premium to grow at a compounded rate of 20 percent over the financial years through March 2019.
- Strong brand and parentage; Well placed on distribution.
- Remains outperformer in private life insurance despite challenging business environment.
- Diversified multi-channel distribution network gives a competitive edge.
- Under-penetrated market provides significant growth opportunity.
Equirus on Whirlpool
- Initiated ‘Add' with a price target of Rs 1,717, implying a potential upside of 12.1 percent from Friday's close.
- With favorable industry dynamics Whirlpool is well-poised for growth.
- Plugging portfolio gaps to drive incremental volumes, improve brand image.
- Distribution network expansion, new product launches to drive growth.
- Revenue growth to be powered by refrigerators, WM and ACs.
- Expect revenue, operating income and net profit to grow at a compounded rate of 19 percent, 21 percent and 20 percent respectively over the financial years through March 2020.
- Stock trades at reasonable valuations.
- Refrigerator segment – penetration levels to increase to 43 percent by March 2022.
- Washing machines – Growth to be driven by fully-automatic machines.
- Air conditioning segment – Split ACs to lead the way.
- Focus on profitable growth to shore up operating income and net profit.
ICICI Direct on Himadri Speciality
- Initiated ‘Buy' with price target of Rs 245, implying a potential upside of 29.3 percent from Friday's close.
- Growth visibility is healthy with impressive capex and firm financing plans amid robust product demand.
- Debt at controlled level; debt-to-equity steadily on decline.
- Expect revenue, operating income and net profit to grow at a compounded rate of 22.7 percent, 29.3 percent and 38 percent respectively over the financial years through March 2020.
- Expect Himadri to command premium valuations among its peers.
- Coal tar pitch: Dominance to sustain; cash cow.
- SNF a construction chemical is big opportunity.
- Carbon black: Industry in sweet spot, Himadri a key beneficiary.
- Advance carbon material to fetch high margins and boost earnings from March 2020.
- Himadri is one of the only few listed players with exposure to Electric Vehicle.
HSBC on Gujarat Pipavav
- Upgraded to ‘Buy' from ‘Hold'; raised price target to Rs 174 from Rs 144, implying a potential upside of 8.1 percent from Friday's close.
- Pipavav is set to receive another two weekly services.
- Rebound in India-China EXIM trade bodes well given exposure to Far East.
- Earnings momentum to resume an upward trend in the near future.
- These service wins along with improved trade outlook raised earnings estimate.
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