Stock brokerages including Sharekhan, Axis Securities, Prabhudas Lilladher, and Motilal Oswal have come out with research reports on select stocks namely IndusInd Bank, Bajaj Auto, Reliance Industries (RIL), and Dalmia Bharat. Here's what brokerages said about these counters.
Brokerage firm Sharekhan has a ‘Buy’ rating on IndusInd Bank stock with a target price of Rs 1,650 per share. The brokerage believes that there is still headroom for reduction in credit cost and it augurs well in case there is higher-than-expected growth in operating cost in FY2024, as the bank continues to invest in the franchise for future growth.
"Strong loan growth momentum, stable, NIMs, and lower credit cost are likely to support earnings growth, and this should keep RoEs at ~15% in the near term. Near-term business growth outlook looks comfortable, led by benign corporate, credit cycle, stable CV, and MFI cycle, which should support operating metrics. The bank is likely to outperform the sector in terms of earnings growth, led by stable NIMs, strong loan growth, and lower credit cost, which could translate into higher RoA," said Sharekhan on IndusInd Bank.
Axis Securities has a ‘Buy’ rating on Bajaj Auto stock with a target price of Rs 5,400 per share. According to the brokerage, the company has a robust domestic IC engine franchise, however, export pickup, and establishing market share through successful EV-2W/3W launches will be the key monitorable for the stock.
"Bajaj Auto’s focus on the 125cc+ segment is in line with the changing industry dynamics, where the share of commuter motorcycles is declining (~60% of total domestic sales in FY16, coming down to 50% in FY23). The company through its exclusive dealership networks for KTM, Bajaj Motorcycles, Chetak Electric, and 3-wheelers offers differentiated customer experience and preserves brand value. The recent Triumph launch will also be marketed through the exclusive Triumph network, and we expect it to plug the gap in the portfolio," said Axis Securities.
Brokerage firm Prabhudas Lilladher has a ‘Buy’ call on Reliance Industries (RIL) stock with a target price of Rs 2,898 per share. At its 46th AGM, the Mukesh Ambani-led conglomerate reiterated aggressive growth plans across various business verticals.
Reliance Industries' Oil and Gas segment is on track to produce around 30 mmscmd of gas from the KG Basin. "On new energy front, RIL plans to setup a battery giga factory by 2026 with its first CBG plant commissioned in Uttar Pradesh. The retail segment will focus on rapid store expansion and brand partnership/acquisitions to accelerate growth. We believe RIL provides a good investment opportunity given 1) its transition towards new age technologies and 2) cash flow for growth serviced from traditional refining and petrochemical segment," said Prabhudas Lilladher in its report.
Motilal Oswal has a ‘buy’ rating on Dalmia Bharat stock with a target price of Rs 2,400 per share. The brokerage believes that the company is a long-term play, backed by: a) robust growth plans, along with diversification in its market presence; b) locational advantages in the east region (clinker facilities in Odisha and Bihar), and c) its commitment to ESG, which will also aid cost reductions.
"With a likely improvement in earnings (22%/29% EBITDA/PAT CAGRs over FY23-25E) and its focus on capacity expansions without leveraging the balance sheet, we expect the stock to trade at higher multiples. We value DALBHARA at 13x FY25E EV/EBITDA to arrive at a TP of Rs 2,400, an upside of 18% from current levels. We maintain our BUY rating on the stock," Motilal Oswal said in its report.
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