Axis Securities has downgraded Hindustan Unilever to ‘hold’ rating with a target price of Rs 2,520 (+8%). Analysts expect near-term challenges for the company to persist with subdued demand in urban areas, increased competitive intensity, and volatility in key raw material prices. These factors are likely to impact volume growth and margins in the near term. However, in the long term, HUL’s growth prospects remain strong.
Emkay Global Financial Services maintained its ‘sell’ rating on Dr Reddy’s Laboratories with a target price of Rs 1,150 (-11%). Analysts feel that in Oct-Dec quarter, after adjusting for the milestone payment received from Journey Medical Corp, its numbers were below street and Emkay’s estimates. They broadly maintain their lower-than-street earnings estimates.
BNP Paribas India has an ‘outperform’ rating on HDFC Bank with a target price of Rs 2,250 (+35%). The lender’s stock remains the brokerage’s top pick in the banking space. Analysts feel that as the easing cycle comes with delayed benefits of FD repricing, increased CASA momentum or a likely loan-mix shift, HDFC Bank remained a counter-intuitive beneficiary of rate cuts. They think many of the fears are overdone and the current price offers an attractive buying opportunity.
Prabhudas Lilladher has a ‘hold’ rating on Persistent Systems with a target price of Rs 5,970 (-5%). Analysts feel the company’s unique value proposition and its strong play around regulated verticals are keeping it more resilient in the current adverse environment for the sector. Additionally, the investments around hiring senior leadership within key verticals have been instrumental in fueling client mining/hunting activities and closing large strategic deals. However, the valuation looks expensive with all the positives factored in in the current price.
Centrum Broking has a ‘buy’ rating on Nuvoco Vistas Corp with a target price of Rs 472 (+33%). Analysts say the cement producer reported a weak set of numbers during the Oct-Dec quarter. The company pursued higher volume growth at the expense of realizations. The company reported strong volume growth compared to the industry’s number. The company has always promoted value over volume in the past and hence last quarter results were perplexing.
