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ICICI Securities

Articles By ICICI Securities

274 Articles

Maintain ‘buy’ on ACC with target price of Rs 1,830

ACC continue to surprise positively for third consecutive quarter with Q3CY20 EBITDA increasing 21% YoY to Rs 6.7bn - higher than our /consensus estimates.

Q2FY21 preview: Significant recovery for the power sector

National tariff policy, change in law and other positives expected to lead to re-rating; NTPC, Coal India are top picks

Shilpa Medicare Rating ‘Add’; USFDA warning letter to delay new approvals

FY21-23e EPS down 7-10% and TP lowered to Rs 580 from Rs 638; outlook is positive; ‘Add’ maintained

Management’s focus is on strengthening the oncology pipeline for regulated markets and foray into biosimilars, transdermals, etc.

Maintain ‘buy’ on AIA Engineering with unchanged TP of Rs 2,043

Uncertainty of global growth due to the pandemic, the company is still gauging the overall impact of Covid-19 on global economies and has deferred any future guidance.

Capex of Rs300 million has been done in Q1FY21 and Rs600 million during FY20 for the same purpose (deadline remains unchanged at March’21).

Cement Q2 preview: September volumes augur well for the quarter

Strong Ebitda growth of 22% y-o-y expected; upside risk to consensus estimates; SRCM and UTCEM top picks

We maintain our positive stance and see an upside risk to consensus estimates. SRCM and UTCEM remain our top picks.

Greenpanel Industries Rating ‘Buy’; Demand revival a shot in arm for company

Prospects bright for firm; FY21/22 EPS up 163/71%; TP raised to Rs 100 from Rs 39; upgraded to ‘Buy’ rating

However, with faster-than-expected demand recovery in MDF category (which also seems sustainable) post Covid-19 breakout, GNPL may sweat its capacities much faster than envisaged earlier.

ONGC may gain from gas price moves; reiterate ‘buy’

We expect a floor price of US$4.2/mmbtu, or that linked to JKM spot LNG (US$4.2-4.6/mmbtu in FY22-FY26E if US$1/mmbtu discount to JKM) to be soon introduced for APM gas followed eventually by phased deregulation over the next

Downgrade Vedanta to ‘reduce’ on Covid-induced lockdowns

Alumina production costs in aluminium dropped by ~$54/te q-o-q, power costs fell by ~$100/te q-o-q while other hot metal and conversion costs were down ~$40/te q-o-q.

Analyst Corner: Retain ‘buy’ on Embassy Office Parks REIT with TP of Rs 430

The Embassy Office Parks REIT (Embassy REIT) continues to deliver a resilient performance with office rental collections of 98.5% in Q2FY21 (99.9% collected in Q1FY21) despite of Covid-19 headwinds.

Visaka Industries Rating: buy; FY21 likely to see sharp growth in profitability

FY21/22 EPS up 15.6/7.8% given Q2 showing; rerating on cards; TP revised to Rs 552; stock’s a compelling ‘Buy’

We expect the sustained growth momentum and firm pricing environment to drive sharp improvement in profitability in FY21e.

Analyst Corner: Upgrade GSK to ‘hold’ from ‘reduce’ with TP of Rs 1,539

Company has witnessed that most of its key brands have outpaced their respective industries and gained market share.

GlaxoSmithKline Pharmaceuticals, Augmentin ES600, Trelegy, COVID-19 vaccine in india, Fluarix Tetra

JSW Energy rating: Add; SECI Letter of Awards a positive development

TP raised to Rs 66 from Rs 60; downgraded to ‘Add’ given the recent run-up in stock price

Bharat Forge rating: Reduce; Opportunity in defence business is a positive

Expectation hurdle is steep though; upgraded to Reduce with target price of Rs 412

We deep-dived into the artillery segment opportunity, analysed global peers (e.g. Rheinmetall) and our base case incremental DCF value is ~Rs 41/share.

Supreme Industries rating: Buy; Elements for re-rating falling into place

PAT up 24.9/11.7% for FY21/22e given recovery and prospects for core verticals; upgraded to Buy with TP raised to Rs 1,640

Upgrade Titan Company to ‘add’ with TP at Rs 1,250

Upside trigger is gold price correction or volatility leading to surge in volumes (recall the 67% volume growth in Q1FY14).

NTPC Rating ‘buy’; focus on ESG compliance augurs well for prospects

Focus on the plan is expected to help the company improve its ESG scores and bring it at par with some of its global peers. Maintain Buy with an unchanged target price of Rs 165.

Shree Cement Rating ‘buy’; market share gains likely to offset lower prices

Volume boost expected from demand revival post monsoons; risk-reward is favourable after recent correction; ‘Buy’ retained

Analyst Corner: Downgrade VA Tech Wabag to ‘reduce’ from ‘hold’

Higher mix of O&M orders in order book does not aid near-term growth, O&M orders’ proportion in the overall book has grown from 10% in FY19 to 30% as of Jun’20.

Hence, the company has come out with a proposal to further raise Rs 2.8bn.

Maintain ‘buy’ on Apollo; pharmacy business strong

Overall, revenues declined 15.6% YoY to Rs 21.7 billion due to 41.2% fall in the hospital business, although pharmacy business reported revenue growth of 21.0%.

Apollo Hospitals Enterprises, Ebitda margin, AHEL Q1FY21 performance, CAGR, Pharmacy business, Covid-19

Analyst Corner: Maintain ‘buy’ on Spandana Sphoorty

In-line with industry, collections for Spandana also improved from lows of 2% in April to 23%/75%/95% in June/July/August, respectively.

Bharat Heavy Electricals rating: Sell — Covid-19 impacted execution in Q1

FY22 EPS cut by 10% given muted outlook; downgraded to ‘Sell’ with revised TP of Rs 24

HDFC rating: Buy — Excess buffers to back earnings traction

Restructuring likely to be limited; disbursal of loans normalising; FY21/22 EPS up 10/1% due to capital raise; TP revised to Rs 2,423

Similar to actions in Q4FY20, HDFC might proactively prefer recognising non-Covid stress upfront (rather than restructuring).

Analyst Corner: Reiterate ‘sell’ on Blue Dart as headwinds will sustain

Globally, the rate hike has been driven by decline in belly cargo capacity, which is leading to an increase in freight load factor despite drop in freight ton-km.

Due diligence suggests that rates have gone up in India by 7-15% — a hope-inducing factor for Blue Dart Express (BDE) given its operating leverage.

Downgrade Jubilant Life Sciences to ‘hold’ from ‘add’

Consolidated revenue remained dropped 13.2% y-o-y Rs 18.9bn (I-Sec: Rs 23.1bn) and adjusted PAT declined 52.4% y-o-y on lower revenue and margins.

Jubilant Life Sciences, Ebitda margin, covid 19, CDMO business, US market, Remdesivir

Automobiles August dispatches are sign of early festive kick-off

As per media reports, Tata Motors saw highest sales since Mar’18 at ~18.6k units, up 154% y-o-y to become 3rd largest player for two straight months as incremental market share gains are driven by relatively better demand f

NMDC rating: ‘Buy’ — It makes a compelling investment case

The in-principle approval by the NMDC board to demerge the steel plant, i.e. creating a separate listed company eventually with a shareholding akin to NMDC will be value accretive to the minority shareholders.

The cost surprise can be attributed to the bulged other expense of Q4FY20, which has largely normalised in the current quarter.

Ambuja Cement rating: Maintain ‘buy’ with unchanged target price of Rs 255

ACEM plans to set up WHRS plants at Darlaghat and Bhatpara (19.5MW at each location) at a capex of Rs 3.8bn by Q4CY21. Subsequently, the company may set up WHRS plants at Maratha and Ambujanagar in addition to solar plants to

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