Motilal Oswal

Articles By Motilal Oswal

511 Articles

Analyst corner: Downgrade KMB to ‘neutral’ with TP revised to Rs 1,800

The sharp outperformance in the stock (aided by MSCI inclusion) when seen in the context of growth outlook and return ratios (average RoE of 12.7% over FY21-23E) drives us to downgrade our rating to Neutral

kotak mahndra bank home loan

Analyst corner: Maintain ‘buy’ on Mahindra & Mahindra with TP of Rs 830

The company is reorienting its SUV business to maintain its DNA and brand position and garner market share.

Analyst corner: Maintain ‘buy’on V-Mart with TP of Rs 2,350

We interacted with the the V-Mart management to gain the latest insights on the developments and recovery in the Retail Apparel market.

Motherson Sumi Rating ‘Buy’; demand recovery drove Q2 showing

Global operations surprised positively while India missed estimates; FY22e EPS up 7% to factor in stronger revival in SMRPBV and PKC; ‘Buy’ maintained with TP of Rs 150

We upgrade our FY22e EPS by 7%, factoring in stronger recovery in SMRPBV and PKC.

Hindalco Industries Rating ‘BUY’; a strong performance in the quarter

India Ebitda up 15% y-y; higher LME & lower costs to boost profitability; valuations attractive; ‘Buy’ retained with TP of Rs 275

PSUs, CAPEX, capital expenditure, capital outlay, economic development

JSW Energy Rating ‘Buy’; Q2 impacted by lower merchant sales

FY21/22e EPS up 12/7% owing to robust cash flows, efficiencies; TP raised to Rs 73

Maintain Buy with TP of Rs 73/share (earlier Rs 64), broadly led by higher value of its stake in JSW Steel.

Maintain ‘buy’ on Marico with target price at Rs 440

Over the past year, MRCO has witnessed remarkable recovery in its key segments — Parachute, Saffola and more recently in case of VAHO.

Kotak Mahindra Bank Rating: Buy- A strong second quarter for company

Asset quality remained resilient; FY21/22e EPS up 27/20% given outlook; upgraded to ‘Buy’ with TP rising to Rs 1,650

Subsidiaries reported mixed performances, with PAT down 23% y-o-y for Kotak Prime, up 19% y-o-y for Kotak Life, and rising 34% y-o-y for Kotak Securities.

Analyst Corner: Maintain ‘buy’ on SBI Life Insurance with TP at Rs 1,000

1HFY21 VNB margins remained broadly stable at 18.8% (vs 18.7% in 1QFY21), supported by an improving business mix.

SBI life insurance company

Maintain ‘neutral’ on Asian Paints with TP of Rs 1,980

Asian Paints (APNT) witnessed consistent MoM demand improvement in 2QFY21.

RBL Bank Rating buy; Loan growth slipped, CASA mix a positive

Q2 update shows retail was robust; credit cost to remain high in FY21;

Thus, credit cost would remain high at 3.7% for FY21e. Maintain Buy, with TP of Rs 230 (1.1x FY22e ABV).

Vedanta Rating: neutral; weak commodity prices impacted Q1

The aluminium business offset weakness in zinc and O&G; all eyes now on delisting process; retain ‘Neutral’ with TP of Rs 148

Analyst Corner: Motilal Oswal upgrades Hero MotoCorp to ‘buy’ with TP of Rs 3,900

With an apt product portfolio for the rural market, the highest brand recall, and a strong distribution network, it is best placed to benefit from low penetration and ongoing momentum in the rural economy.

HMCL's competitive positioning has improved in both the 100cc and 125cc categories post BS-VI.

Reiterate ‘buy’ on ICICI Securities, company can gain from consolidation

Recent regulatory changes may accelerate consolidation in the industry, and ISEC could be a major beneficiary. Reiterate ‘Buy’.

Other focus areas for the management comprise growing the partnership network and improving technology.

Analyst Corner: Maintain ‘Buy’ on CESC with TP of Rs 760, stock trades fair

S/A PAT declined ~38% YoY to Rs 1.3 billion (29% below our estimate of Rs 1.9 billion). This was largely on account of decline in sales volumes (-31% YoY) to 2.1BU.

Despite factoring in the tightening of norms at Haldia and S/A, the stock trades attractively at 7x FY21 P/E. Maintain 'buy' with target price of Rs 760/sh.

Coal India rating: Buy — Muted power demand hit quarter results

COAL’s management has noted that the company’s receivables have increased to Rs 230 bn in Q1FY21 from Rs 178 bn at end-FY20. However, these decreased to Rs 210 bn at end-Aug’20. COAL expects the situation to normalise f

Jubilant FoodWorks rating: Valuation expensive, maintain neutral

Nevertheless, recovery in system sales was sharp in July ’20 and Aug ’20 to 69.8% and 84.6%, respectively, of last year’s levels for the corresponding months.

Management expects near-normalcy by the exit of FY21.

Analyst corner: Target price for NTPC revised to Rs 137 from Rs 139 earlier

NTPC expects FGD systems to be commissioned within the timelines given by the CEA. In this regard, the company has awarded ~59GW of capacity at project cost of Rs 281b. Furthermore, ~5GW of capacity is under tendering and is

Oil India rating: Maintain ‘buy’ with target price of Rs 115

Total production was at 1.40mmtoe (-6% YoY). On similar lines, oil sales declined 8% YoY to 0.73mmt and gas sales 6% YoY to 0.58bcm. Total sales were at 1.31mmtoe (-7% YoY).

The stock trades at a ~30% discount to its long-term PE average, with a strong dividend payout of >50%.

Hero Motocorp rating: Neutral — A decent operating performance

FY21e EPS up 9% due to faster volume recovery; ‘Neutral’ retained with TP of Rs 3,045

But, we maintain our Neutral rating, with TP of Rs 3,045 (~16x Sep’22 S/A EPS + Rs 98/share for Hero FinCorp).

Power Grid rating: Buy — Rebate impacted profitability in Q1

Declining capitalisation could impact growth, but valuation remains attractive: While the awarding of transmission schemes (~Rs 250 bn) under renewable integration provides a good opportunity to win new awards, our checks hav

power distribution companies, discoms, electricity, pandemic

Cipla rating: Neutral — Opex fall led to strong beat on earnings in Q1

Ebitda margin registered a high; FY21/22e EPS up by 19/14%; ‘Neutral’ retained with revised TP of Rs 790.

SBI rating: Maintain ‘buy’ with target price of Rs 285

SBIN reported strong 1QFY21. This was led by robust NII growth with domestic NIMs improving 30 bps Q-o-Q and controlled opex.

Bharti Airtel rating: Buy — Quarter showing beat expectations

Domestic wireless business withstood Covid-19 impact; ‘Buy’ retained with TP of Rs 700

Bharti has delivered strong execution over the last few quarters with industry leading revenue growth and 4G subscriber adds.

Asian Paints rating: Neutral — Momentum in June drives Q1 FY21 beat

Recovery was better than expected; fears of sharp fall in earnings recede; upgraded to ‘Neutral’ with TP of Rs 1,605.

Oberoi Realty planning to raise Rs 35 bn of capital via combination of equity and NCD

On capital raise plans, company is planning to raise Rs 35 billion of capital via combination of equity (Rs 20 billion) and NCD (Rs 15 billion).

4QFY20 revenue was up 7.3% YoY to Rs 6,155 million (v/s est. Rs 6,556 million).

Avenue Supermarts rating ‘sell’ – Closure of stores hit Q1FY21 bottomline

Second part of lockdown could prolong Covid-19’s impact, with slow recovery extending beyond H1; ‘Sell’ retained with TP of Rs 2,000.

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