Stock Picks Today: M&M Finance, TVS Motor, Indus Towers, Shree Cement Brokerage Radar

Mahindra & Mahindra Financial Services Ltd., TVS Motor Co., Indus Towers Ltd., and Shree Cement Ltd. are among companies that have drawn commentary from top brokerages on Wednesday.

Analysts have tweaked share price targets after these companies announced their September quarter results.

HSBC

• Maintain 'Hold' with price target of Rs 32,200.

• Earnings miss; steep valuation keeps us on the sidelines.

• Q2 earnings miss due to higher costs.

• Continues to highlight its ‘Value over Volume’ strategy, and this bodes well for Industry pricing.

Investec

• Maintain 'Sell' and reduce TP to Rs 29,125 from Rs 29,527.

• Reported operating miss on account of lower pricing.

• Management guides for 3-5% volume growth for FY26, implying 7-13% YoY in H2.

• Interestingly, they indicated delaying 80 MT target to FY29 vs FY28.

• Premium multiples in our view are a reflection of the perceived moat of capex intensity, cost curve positioning, both of which we see eroding.

Jefferies

• Maintain 'Buy' and cut TP to Rs 33,420 from Rs 35,150.

• Q2 miss on higher cost.

• Management reiterates 'Value over Volume' focus.

• Following weak Q2, cut EBITDA estimates by 3-5%.

• Stock outlook will improve only post any turnaround in industry cement prices in Q4.

• Maintain 'Buy' and hike TP to Rs 500 from Rs 460.

• Q2: Mixed quarter, but VI’s improved circumstance lifts outlook.

• FCF sequentially down and cash balance remains healthy.

• Africa foray – organic, debt-funded.

• Believe investor concerns around delayed shareholder payouts, VI’s sustainability, and Bharti’s slowing rollouts have been overdone.

Goldman Sachs

• Maintain 'Neutral' and hike TP to Rs 3,750 from Rs 3,520.

• Q2 in-line: Expect demand momentum to continue into H2.

• Expect a potential reversal in the YTD underperformance of rural volume growth vs urban.

• Rare earth metal shortages remain a constraint on E2W manufacturing.

• This potentially implies slight margin tailwind in the near term due to a lower E2W mix.

BofA

• Maintain 'Neutral' and hike TP to Rs 3,825 from Rs 3,725.

• Good quarter: Ticking all the right boxes.

• Market share gains & margin expansion continue.

• The stream of new launches and GST cut benefit will translate to good domestic growth.

• Exports and EVs in fast lane. Subsidiary losses shrink.

Morgan Stanley

• Maintain 'Overweight' and hike TP to Rs 4,022 from Rs 3,933.

• In-line quarter; Best placed to benefit from up-cycle.

• Expect scooterization and premiumization to be the key drivers of growth in the 2W market.

• Racing ahead – delivering on growth, market share, and margins.

Jefferies

• Maintain 'Hold' and hHike TP to Rs 310 from Rs 298.

• Asset quality held up well, but write-offs stayed elevated.

• Sees momentum in autos post GST cut holding up in H2.

• See modest AUM CAGR of 14% over FY26-28.

• NIMs should expand on easing rates, but elevated write-offs will underpin credit costs and cap RoA.

• Valuations seem reasonable.

Morgan Stanley

• Maintain 'Equal-weight' with TP of Rs 300.

• Management was upbeat on festive season demand and expects H2 to be better than H1.

• See good downside protection but cannot justify meaningful upside.

• Maintain Equal-weight with TP of Rs 5,400.

• SEBI reintroduces proposal for rationalization of total expense ratio.

• Final impact will depend on industry feedback.

• Some offset from passthrough of statutory levies to customers and some to distributors.

• Assuming worst case average hit of 15 bps across equity-oriented schemes, the impact could be 10 bps of FY25 total AAUM which translates to 23% of PBT.

• This is without assuming offset from pass-through of statutory levies to customers, pass-through to distributors, and additional hit from removal of exit load.

• On a previous occasion when such a draft was presented in May 2023, the industry pushed back strongly and the draft wasn’t implemented.

• In September 2018, when total expense ratio caps were lowered, the mutual industry passed almost the entire hit on the back book through to distributors.

• SEBI’s consultation paper on MFs is risk to earnings.

• Cut of 5 bps in equity exit loads can impact FY27 PBT for HDFC AMC and Nippon AMC by 30-33%.

• Cut in cash market brokerage fees from 12 bps to 2 bps to bring equity schemes in-line with arbitrage funds.

• If implemented, it may be negative for institutional brokers including 360 ONE and Nuvama.

• TER to be lowered as statutory charges to be levied separately - change may be neutral to earnings.

• Maintain 'Buy. with TP of Rs 1,100.

• Profit in line; FY26E capex guidance largely maintained.

• EBITDA was 4% above estimates on better operational performance in the transmission segment.

• Smart metering is a new high-growth area.

• Expect overall 30% EBITDA CAGR in FY25-28 on execution-backed growth.

• Maintain 'Sell' with TP of Rs 425.

• Another quarter, another miss and another quarter of elevated claims ratio.

• Market share stable on a YoY basis.

• Continues to be in a tough spot.

• One positive was new premium growth in agency for H1.

• Star is facing multiple challenges both in terms of its size and intense competition from peers.

• Maintain 'Buy' and hike TP to Rs 440 from Rs 410.

• Healthy pick-up in motor to aid earnings.

• Pickup in motor growth may lead to upfront costs but improve earnings visibility.

• Easing of competitive intensity is also key.