Brokerage Radar: CLSA downgrades LIC Housing Fin to ‘Hold’, JPMorgan raises Max Healthcare target price
Check out the latest brokerage calls and analyst comments on the stocks in action today. Our coverage includes State Bank of India, UPL, Titan, Britannia Industries, and more.
Check out the latest brokerage calls and analyst comments on the stocks in action today. Our coverage includes State Bank of India, UPL, Titan, Britannia Industries, and more.
State Bank of India
CLSA On SBI
Outperform Call, Target Raised To `1,075/Sh
Q1 Showed Loan Growth Remains Healthy But Deposit Growth Is Lagging
NIM Largely Stable & Asset Quality Intact
Credit Costs Inched Up To 37 bps, From 15 bps In FY24, But Was Still Below Runrate Levels
Management Expects Loan Growth Of 15% With Margin Largely At Current Levels For FY25
Forecast 15-16% RoE Over Medium-term
JPMorgan On SBI
Overweight Call, Target `1,000/Sh
Q1 PAT (`1,700 Cr; RoE: 18%) Was 5% Ahead Of Estimates Driven By Lower Opex
NII Was In-line W/Core NIMs, Largely Stable QoQ While Core PpOP Was 3% Ahead Of Est
Gross Advances Grew 15% YoY With Broad-based Growth Across Segments
Opex Growth (+1% YoY) Saw A Sharp Moderation With Wage Revision Provisions Behind
Think Opex Growth Will Provide An Offset To NIM Pressures Through FY25
Asset Quality Performance Was Stable
Net Slippages At 54 bps & It Kept Loan Related Provisions At Around 50 bps
Q1 RoA Stood At 1.1% & Think Co Can Hold 1%+ Mark Given Benign Credit Cost & Flex Around Opex
UBS On SBI
Sell Call, Target `725/Sh
Lower Opex & Higher Other Income Offset NII Miss In Q1; Credit Costs Inch Up
Deposits Declined 0.3% QoQ; In-line With Muted Deposit Growth In Sector
Credit Costs Of 50 bps (Annualised) In Q1 Came In Higher Than FY24 Levels
Expect Co’s Current RoA Of >1% To Decelerate As Believe Credit Costs Would Trend Up
Relatively Lower Core PpOP To Assets Leaves Little Cushion On Current Profitability
Low Counter Cyclical Buffers Leaves Little Cushion On Current Profitability
Management Remain Confident Of Unsecured Retail Segment’s Asset Quality
Investec On SBI
Buy Call, Target `880/Sh
Co Reported A Miss On NIMs/Core PpOP In Q1
NII Growth Weak On Back Of Declining YoAs & Rising CoD
Credit Costs Doubled Sequentially To 0.43% Owing To Seasonally Higher Slippages
Co Managed To Keep Opex Under Control, Delivering Healthy RoAs In A Seasonally Weak Quarter
Expect Credit Growth To Be Strong At 15% YoY For FY25 With Bank Having Adequate Liquidity Buffers
Titan
MS On Titan
Equal-Weight Call, Target `3,620/Sh
Q1 Topline Growth Was Weak (But Known), Profitability Was In-line
Co Has Seen Some Benefits From Recent Custom Duty Cut
Gold Price Stability Remains A Key Monitorable
Higher Competitive Intensity Is New Reality, Overall Market Share Maintained
Macquarie On Titan
Outperform Call, Target `4,100/Sh
Q1 Beat Led By Stronger Jewellery Margin
Company Sees Custom Duty Improving The Operating Environment
Market Share Flattish
Co Retained Guidance For 11.5-12.5% Jewellery Margin Despite Expected Reduction In Discounting Pressures
Citi On Titan
Neutral Call, Target `3,510/Sh
Revenue (Ex-Bullion) Growth Of 9% YoY, In-line With Estimates Was Impacted By High Gold Price
Revenue (Ex-Bullion) Growth Was Impacted By Less Wedding Days, Heatwave
Q1 PAT Declined By 1% YoY & Was Broadly In-Line With Estimates, 6% Below Consensus Est
Jewellery EBIT Margin Improved 20 bps YoY To 11.2% Vs Estimate Of 10.6%
Jewellery EBIT Margin Was Led By Stable GM (Studded Mix Was Flat YoY) & Cost Optimisation
Q2 Growth May Benefit From Import Duty Cut, Given Elevated Competitive Intensity & Gold Price
Watch Out For Margin Trajectory
Britannia Industries
Investec On Britannia
Hold Call, Target `5,541/Sh
Q1 Saw Miss On Margin Which Brings Up Earnings Downgrade Risk
Gross Margin Improved By 147 bps YoY But Was Down 149 bps QoQ To 43.4%, Below Est Of 44.8%
EBITDA Margin Improved By 56 bps YoY To 17.7%, Below Estimate Of 18.8%
Macquarie On Britannia
Neutral Call, Target `4,700/Sh
Q1 EBITDA Below Est As Gross Margin Miss Offsets Sales Beat
Co Indicates Rural Market Share Growing Faster Vs Urban
Gross Margin Surprised Negatively, Moderating 150bps Sequentially
EBITDA Came In 4% Below Estiamtes
PAT Was In-line, As EBITDA Miss Was Offset By An 8% Sequential Decline In Depreciation Costs
MS On Britannia
Equal-Weight Call, Target `5,021/Sh
Q1 Rev/EBITDA/Adj PAT Growth Of 4/9/16% YoY, Respectively, Which Were -1/-6/ -4% Vs Estimates
Revenue Was Up 9% On A 5-yr CAGR Basis Vs 8% In Q4
Gross Margin Expanded 42 bps YoY, Down 238 bps QoQ To 41.8% Vs Est Of 43%
EBITDA Margin Expanded 90 bp YoY, Down 137 bps QoQ At 18.2% Vs Estimate Of 19.2%
LIC Housing Finance
Nomura On LIC Hsg Fin
Buy Call, Target `875/Sh
Q1 Asset Quality Stable, Credit Cost Declines Mainly Driven By ECL Reversal
Disbursements Grew 19% YoY/ Down 29% QoQ, AUM Growth Tepid At 4.4%/0.6% YoY/QoQ
NIMs Contracted 40 bp QoQ Due To Lower Yields
Believe Current Valuation At 1x FY26 Book Value Remains Reasonable
CLSA On LIC Hsg Fin
Downgrade To Hold, Target `800/Sh
Q1 Loan Growth In-line With Expectations But Margin Moderate
Gross NPLs Steady But Net Slippage Spiked
Credit Cost Was At Its Lowest In 14 Quarters
Credit Cost Driven By Reduction In Provision Coverage Across Stage 2 & Stage 3 Loans
Calculated Spread Declined 35 bps QoQ Due To Lower Interest Income On NPL Accounts
Management Disclosed This Metric For The First Time
Loan Growth Remains Muted In Mid-single Digits
A Pickup In Disbursement Growth Will Take Time To Be Reflected In AUM Growth
Jefferies On Divis LabsHold Call, Target `4,830/Sh
Q1 Results Were Ahead Of Estimates As Custom Synthesis Sales Increased 46% YoY
Generics And Nutraceutical Sales Were Flattish YoY
Generics Continued To Struggle With Pricing Challenges
Mgmt Provided Bullish Commentary On Custom Synthesis & Increased Workflow On Peptides
Jefferies On UPL
Buy Call, Target `665/Sh
Co Reported Net Loss In Q1
Healthy Volumes (+16%YoY) Were Offset By Sharp Price Decline
Healthy Volumes Were Upset By Industry Overcapacity & Chinese Competition
Co Expects Prices To Stabilise Now, With Recovery In H2FY25
Mgmt Retains FY25 Outlook
Cut FY26-27 EPS By 2% While FY25 Cut Is Sharper
Jefferies On Whirlpool
Underperform Call, Target Raised To `1,670/Sh
Q1 PAT (+92% YoY) Was Aided By Growth In Refrigerators & AC Verticals (Strong Summer)
Raise FY25-27 EPS By +4-7%, And Est +23% EBITDA CAGR
Factoring Healthy 8%+ OPM In Q4 & Q1, & Positive Mgmt Commentary, Raise Target PE By 10%
Risk-reward Appears Stretched At Current FY25/26 PE Of 75/60x
JPMorgan On Max Health
Overweight Call, Target Raised To `1,010/Sh
Q1 Results Were In-line With Estimates
Growth Outlook Intact; New Units Poised For Further Acceleration
Continue To Like Co For Its Strong Execution
Like Co For Superior Growth Prospects
Forecast Revenue/EBITDA CAGR Of 25%/25% Over FY24-27
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