Business News

US brokerage Jefferies has maintained a buy view on Bharti Airtel and MGL while Cummins India received a ratings upgrade from HSBC. Among other notable brokerage actions, BofA reiterated a buy view on NBFC play Bajaj Finance while CLSA initiated a coverage on Avenue Supermarts. Kotak Securities also upgraded IRB Infrastructure to ‘Add’ from an earlier ‘Sell’ stance. We have collated a list of recommendations from top brokerage firms from ETNow:Jefferies on Bharti Airtel: Buy | Target: Rs 1,300Jefferies has maintained a buy view on Bharti Airtel for a target price of Rs 1,300. The US brokerage said that the management's focus is now on driving a steady, organic increase in ARPU (average revenue per user) through improving subscriber mix and better monetisation. While the timing of tariff hikes remains uncertain, they remain key for 5G monetisation and improving ROCES.The management is expecting the capex to moderate from FY25 and aims to deleverage the balance sheet further, Jefferies said.Jefferies on MGL: Buy | Target: Rs 1,540Jefferies has reiterated a buy view on Mahanagar Gas stock and hiked the target price to Rs 1,540 from Rs 1,515. The margin hit is cushioned by falling feedstock costs, Jefferies said. Moreover, a soft LNG market is providing additional leverage to protect margins. UEPL (Unison Enviro Private Limited) is expected to aid the volume growth.The EV penetration remains low in the absence of strong policy support which acts as a negative, Jefferies said but correction presents a favourable risk-to-reward.HSBC on Cummins: Buy | Target: Rs 3,300HSBC has upgraded the stock to 'Buy' from 'Neutral' and raised the target price to Rs 3,300 from Rs 2,600. The company is witnessing strong growth and the transition to the new emission control norm in a strong demand environment is likely to be value growth and margin accretive. The growth outlook across end markets in the domestic market is looking solid while exports are bottoming out, the brokerage said in a note. It expects a strong earnings outlook with high visibility.BofA on Bajaj Finance: Buy | Target: Rs 9,175BofA has maintained a buy rating on the counter placing the target price at Rs 9,175. It said that a de-rating of 24% over 5 months is excessive. With liquidity improving, the growth outlook remains strong. The asset quality trends are also healthy.CLSA on Avenue Supermarts: Buy | Target: Rs 5,107CLSA has initiated a buy rating on the DMart operator for a price target of Rs 5,107. It said that the private labels under the brand are rising and should drive the next leg of share gains. The company offers the lowest consumer prices due to the lowest operating cost in its view. The $500 billion addressable market is less than 5% organised. Kotak Securities on IRB Infra: Add | Target: 65Kotak Securities has upgraded the stock to 'Add' from an earlier 'Sell' stance and raised the target price to Rs 65 from Rs 60. The company is adding strategic partners at the private InvIT and the amended model concession agreement paves the way for BOT (built, operate, transfer) ordering. The road sector awarding has shifted to TOT (toll operate transfer) and BOT projects, with NHAI's focus on managing its debt levels.With a Rs 44,400 crore BOT pipeline for FY24, Kotak sees players such as IRB, with its strong balance sheet, best placed to benefit.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

Block trades in India are close to capping their best quarter in 14 years as the country’s booming stock market encourages shareholders to monetize stakes.Shareholders have raised $7.1 billion selling their holdings in India so far this year, with the quarter on track to have raised the most from block trades since the January to March period in 2010, data compiled by Bloomberg show.India’s equity capital markets have been running hot for the past year as its stocks climb to record highs and foreign investors pile in amid a rotation away from China, which has been mired in an economic slowdown. More foreign inflows are likely to come after the nation’s general elections starting next month, with the country’s growth prospects acting as a catalyst. 108664231“With elections over, there could be another round of block trades or sell-downs. Domestic liquidity and foreign appetite remain very strong for Indian assets,” said Rahul Saraf, Citigroup’s India head of investment banking. The election results will be tallied on June 4.With one of the world’s fastest rates of economic growth and relative political stability, Indian equities have soared, with the benchmark Sensex Index notching eight years of annual gains. The euphoria has prompted companies in India to go public at the fastest pace on record, as well as encouraging a continuous flow of additional share sales by listed firms since the start of the year.The flurry of activity contrasts with a slowdown in other parts of Asia, including Hong Kong and China, where a mix of economic growth woes and lower valuations have kept sellers on the sidelines. There hasn’t been a block larger than $500 million in mainland China or Hong Kong since July, Bloomberg-compiled data show.This week, Tata Sons Ltd. raised the equivalent of $1.1 billion through the sale of shares in the group’s software services unit Tata Consultancy Services Ltd. It’s the largest block involving shares of the software services unit since 2018, data compiled by Bloomberg show.British American Tobacco Plc last week raised almost 175 billion rupees from the sale of a 3.5% stake in its Indian partner ITC Ltd. for Asia’s largest block trade of 2024. That followed an upsized $820 million stake sale in India’s biggest airline IndiGo by its co-founder, who cashed in as the stock neared a record high.US home appliance giant Whirlpool Corp. sold part of its stake in its Indian unit in February, raising $469 million. It joined a number of foreign firms monetizing their Indian businesses to take advantage of the high valuations.Investors have mostly welcomed the stake sales. ITC’s shares surged the most in almost four years after BAT’s disposal and were trading above the offer price last week. IndiGo’s shares have climbed almost 8% above the price at which Rakesh Gangwal sold them in the block trade.

“The global semiconductor sector is positioned for a decade of expansion and is forecasted to reach a trillion-dollar industry by the year 2030 driven by automotive, data storage, and wireless industries,” says Anil Rego, Founder and Fund Manager at Right Horizons - A SEBI-registered PMS provider.In an interview with ETMarkets, Rego said: “We are bullish on the Banking, Auto & Ancillaries and Building Materials segment as we expect these segments to continue driving incremental earnings and further quality names within the space are likely to outperform peers,” Edited excerpts:It has been a volatile month so far – what is fueling volatility in the markets?Anil Rego: The mid and small-cap segments have exhibited higher volatility compared to large-caps, fueled by concerns of overvaluation in the broader market.AMFI issued advisories urging members to moderate investments in small and mid-cap funds amid fears of a potential market downturn due to significant inflows.Responding to SEBI's directives, AMFI mandated mutual funds to conduct stress tests to assess their resilience.These measures aim to mitigate risks associated with excessive inflows and market instability, emphasizing the need for caution and strategic planning within the mutual fund industry to navigate potential challenges and safeguard investor interests.The voices are growing louder about the valuations around small & midcaps – what are your views?Anil Rego: The small-cap and microcap sectors are witnessing volatility as investors exercise caution amidst concerns of overvaluation. We anticipate this volatility to persist in the short term.Our recommendation is to restrict exposure to high-quality stocks within this segment, which are available at reasonable prices and demonstrate consistent healthy earnings growth.This approach aims to navigate the current market uncertainties while capitalizing on opportunities presented by fundamentally sound investments.How should investors value small & midcaps for investment in FY25? How to determine which stock is overpriced after the recent rally?Anil Rego: The SMID segment offers high returns but comes with increased volatility. We expect selective names with a strong order book, superior earnings growth & healthy return metrics and a sustainable business model are likely to be good opportunities.We prefer companies that are available at a reasonable discount to value with clear signs of profitability and are gaining market share from the competition.If the growth momentum in earnings is sustainable for the longer term then investors may continue to hold the investments despite the rally.What is your view on Gold which is also hovering around record highs? Which is a better investment in 2024 – Gold or Silver?Anil Rego: Throughout history, gold and silver have served as safe-haven assets, offering protection against unforeseen events like market downturns and crises.Recently, gold surged to record highs amid one of the most significant rallies in years. Anticipating Federal Reserve interest rate cuts and declining U.S. real yields, we foresee continued support for gold prices.These factors underscore the enduring appeal of precious metals in times of economic uncertainty, as investors seek refuge in assets known for their stability and resilience against turbulent market conditions. As we close the FY24 – how do you see FY25 for Indian markets. Any trigger points that investors should take note off?Anil Rego: India is benefiting from tailwinds with healthy GDP growth, moderating inflation, range-bound oil prices, expected rate cuts, and resilient corporate earnings.Mid and Smallcaps have rallied since March’23 considering the structural shifts in the domestic economy that are steering toward the multi-decadal growth outlook of the economy.However, we see limited opportunities in this space in the near term and expect the large caps to contribute going forward against the backdrop assuming a stable global macro, domestic political continuation, and gradual rate cuts by the RBI.Risks are currently exogenous such as global slowdown and geopolitical uncertainty.Your list of sectors that investors should not ignore in FY25?Anil Rego: We are bullish on the Banking, Auto & Ancillaries and Building Materials segment as we expect these segments to continue driving incremental earnings and further quality names within the space are likely to outperform peers.Building Material -We are optimistic about the building materials demand outlook due to increased investment towards infrastructure, urbanisation, and a recovery in the housing and commercial real estate markets.In the FY24 budget, the government has proposed to increase the funds for PM Awas Yojna by 66%, making it Rs. 79,000 crores boosting the pace in affordable segment housing in India.Additionally, the government has proposed investing heavily in transport infrastructure projects benefitting the real-estate markets across India, especially in Tier-2 and Tier-3 cities.Auto –The sector is in a cyclical uptrend supported by a sharp recovery in urban demand and a shift in preference towards EVs.Banking –The Banking space is witnessing robust credit growth momentum driven by the continued traction in the Retail and SME segments. On a segmental basis, home loans, Auto loans and Credit card outstanding continue to grow, and corporate loans are recovering gradually.However, deposit growth continues to lag credit growth, so focus on mobilising deposits is a key monitorable.What are your views on the semiconductor trend for the next FY? Will the next set of multi-baggers come from a manufacturing/IT theme?Anil Rego: The global semiconductor sector is positioned for a decade of expansion and is forecasted to reach a trillion-dollar industry by the year 2030 driven by automotive, data storage, and wireless industries.While the IT sector is under pressure in the near term, over the longer-term, IT sector should also do well due to structural favourable factors. We believe both industries over the long term to grow healthily.SIPs have hit nearly Rs 19,000 cr mark/month. The trend is picking up fast – what does it say about the retail investor behaviour and how do you see the trend picking up in FY25?Anil Rego: According to data from the Association of Mutual Funds in India, monthly contributions to systematic investment plans (SIPs) have reached a new peak of ?19,186 crore, exceeding January's peak of ?18,838 crore.The increase in the number of investors observed during the post-pandemic period, despite volatility caused by global geopolitical factors and inflation, also indicates resilient investor behaviour.India’s strong fundamentals relative to other economies are due to the buoyant credit cycle and de-levered balance sheets of corporates and a healthier banking system.With earnings growth prospects and relatively better fundamentals, we expect the momentum to continue.(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

Benchmark indices rebounded on Wednesday amid a largely firm trend in global equities. The 30-share Sensex rose 89.64 points to settle at 72,101 and the Nifty climbed 21.65 points to finish at 21,839.Stocks that were in focus included names like LIC, which fell 1.21%, Zomato, which jumped 5%, and Bharti Airtel, whose shares rose 0.26% on Wednesday.Here's what Riyank Arora, Technical Analyst at Mehta Equities, recommends investors should do with these stocks when the market resumes trading today.LICThe stock witnessed significant selling pressure in the last month, falling nearly 25% from its all-time highs. On the monthly and weekly timeframes, charts are suggesting a re-test of the breakout zone ranging from 866.00 to 918.00.This re-test of the breakout zone offers an attractive buying opportunity at current levels, with a suggested stop-loss set at the 840 mark.ZomatoThe stock has experienced a breakout above the recent anchor VWAP resistance level of 164 and has successfully closed above it. The overall technical structure appears bullish, with potential higher levels of 175 and 190 anticipated.A strict stop-loss near 150 is recommended for all active long positions on Zomato.Bharti AirtelThe stock continues to trade at its all-time highs despite weak market sentiments and has maintained its position strongly. At the current market price of 1231.80, the overall trend remains bullish, with immediate support at the 1200 mark.Below this level, the stock might dip towards 1175 and 1150. However, as long as the stock sustains well above this level, higher levels of 1300 and 1325 may be expected.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

The sell-off in mid-cap and small-cap stocks in recent weeks has soured sentiment in this space but some of these shares may still be holding some promise. At least 60 stocks have the potential to rise between 25% and 60% based on analysts’ consensus estimates available on Bloomberg. These companies are tracked by at least 10 analysts. Ujjivan Bank, Bandhan Bank, PSP Projects, Vedant Fashions, PNB Housing Finance, Prince Pipes & Fittings, Transport Corp, Greenpanel Industries, Galaxy Surfactants, and Somany Ceramics, could return at least 25%, according to average price targets on Bloomberg. The majority of stocks have dropped from the beginning of the month, with the Nifty Midcap and Smallcap indices plunging by 6% and 9%, respectively, compared to a 2.2% fall in the Nifty 50 index. 108661658Ujjivan Bank, which has declined by 23% so far this month, could potentially rally by 50% within a year, according to 14 analysts tracking the stock. Similarly, Bandhan Bank, tracked by 28 analysts, could see an upswing of up to 45%. The stock has witnessed a decline of 26% since March. Among large caps, HDFC Bank, after having fallen by 16% this month, could gain by 34% in a year.