Brokerage commentaries on Tuesday highglighted opportunities across sectors ranging from reatil, fast moving consumer goods (FMCG), non-banking financial companies (NBFCs) and the defence sector. .
Analysts also gave their view on banking giants such as Axis Bank Ltd., Kotak Mahindra Bank Ltd., and HDFC Bank Ltd..
Among sectoral calls, brokerages remained positive for the Indian banking sector after Q2 business updates from Axis Bank, Kotak Mahindra Bank, HDFC Bank Ltd. among others.
Goldman Sachs (GS) On IDFC First
- Maintain Neutral with TP of Rs 92
- Strong growth delivery
- High-cost deposit run-down positive
- Asset quality trends remained healthy during the quarter
- Valuations fair
GS On Axis Bank
- Maintain Buy with TP of Rs 1477
- Strong FNCR flows helps repay high cost deposits
- Steady loan growth
- NIM progression would be better for the domestic bank relative to peers
- Cyclical headwinds are now largely behind
GS On IndusInd Bank
- Maintain Neutral with TP of Rs 1020
- Loan growth picks-up; Muted deposit growth
- Asset quality stress largely behind
- IndusInd Bank is entering a multi-year recovery phase
- Valuations already discounts much of the recovery
GS On Godrej Consumer
- Maintain Buy with TP of Rs 1030
- Strong quarter despite cost pressures
- Strong high-teens revenue growth, broad based performance across India and international business
- Meeting guidance of double digit consolidated EBITDA growth despite input cost pressures
GS On Kotak Mahindra Bank
- Maintain Buy; Hike TP to Rs 540 from Rs 509
- Strong performance on mobilization of FCNR (B) flows
- Organic loan growth accelerated sharply to 19% YoY
- Deposit growth was strong at 23% YoY / 14% QoQ
- Raise earnings to reflect stronger than expected loan growth, stronger than expected FCNR (B) deposit inflows and higher than expected rate hikes by the RBI
GS On Trent
- Maintain Neutral; Hike TP of Rs 3010 from Rs 2960
- Strong sales growth despite late festive season
- Expect margin headwinds in the near term
Kotak Securities On BEL
- Upgrade to Add from Reduce; Cut TP to Rs 410 from Rs 420
- Strong order prospects; growth delivery critical
- AMCA, Project Kusha and P75I/NGC anchor big-ticket pipeline
- Missiles to become second key growth vertical; QRSAM signing remains key
- Margin normalization and slowing execution in 2028 remain key risks
- Cut FY28-29E estimates by 3.5%/4% as we moderate execution assumptions
Citi On Kotak Mahindra Bank
- Maintain Buy with TP of Rs 465
- Advances Surge 24.7% YoY, Core Growth Comfortably Surpasses estimates
- Beat attributed to continued strength in corporate banking, SME, LAP and MFI segments
- Delivered a marked step-up in balance sheet momentum
- With FCNR(B) deposit mobilization lending additional thrust to an already robust sequential accretion
Jefferies On NBFCs
- Rate hike concerns weigh on NBFC stock prices
- NIMs have diverged across rate cycles
- Valuations reflect higher rates ahead of first hike
- HFCs, select diversified NBFCs to gain; auto NBFC NIMs to dip
- Growth strong, Asset Quality resilient; stay watchful of weak monsoon risks
- Valuations attractive; risk-reward favourable
JPMorgan On Marico
- Maintain Overweight with TP of Rs 915
- Strong Q2 revenue growth backed by double digit domestic volume growth
- Mid-20s EBITDA growth likely, ahead of 22% estimates
- Believe it is amongst the best-placed staples names to own
GS on RBL Bank
- Maintain Sell with TP of Rs 285
- Strong loans growth led by wholesale and loans against FCNR-B deposits
- Believe the pace of underlying profitability improvement will be gradual
- At a current valuation, see a more favorable risk-reward ratio at peer private banks
Citi On Trent
- Maintain Sell with TP of Rs 2950
- Q2 – revenue growth accelerates
- Sustenance key for re-rating
- Remain cautious on weak revenue/sq. ft. trend
- See impact of cannibalisation and competition
MS On Trent
- Maintain Overweight with TP of Rs 3406
- Q2 – strong neat
- Revenue growth accelerates to 23% from 16-20% in past 5 quarters
- View margins as key to monitor
- Better-than-expected revenue growth, especially in context of the shift in the festive calendar, should be viewed positively
Jefferies On Meesho
- Maintain Buy with TP of Rs 240
- Mgmt. expects 25% NMV CAGR over next 5-years supported by user growth, higher order frequency & logistics efficiencies
- Positives - improving contribution margin, financial services optionality & rising penetration in higher-value categories
- Positioned for sustained profitable growth
- Value-led positioning, Valmo scale & deep reach beyond metros remain the key Meesho moats
Citi On Axis Bank
- Maintain Buy with TP of Rs 1620
- Mobilizes US$10.62bn of FCNR Deposits
- Core Advances Growth Held Steady
- Repaid Bulk Deposits
- NIMs are projected to decline 8 bps QoQ owing to FCNR-related drag
- Despite enlarged balance sheet, bank is well-positioned to sustain RoA profile and PAT growth
Bernstein On HDFC Bank
- Maintain Outperform with TP of Rs 1150
- Leadership transition appears to be on track
- Few quarters without any major kitchen-sinking exercise, coupled with greater stability in the top management team, could help alleviate the governance concerns
- Beyond the CEO transition, there are several other factors that could go right for the bank
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