Buy Jindal Steel and Power Ltd For Target Rs.180.00 - Motilal Oswal

On path to doubling India steel volumes in two years

Angul site visit highlights

We visited Jindal Steel and Power’s (JSP) Angul steel plant. The company appears to be on track to more than double its steel capacity at Angul to ~5mt (from current ~2mt) in two years by adding capacity through a more efficient hot metal p

16/03/2017 3:15:20 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sun Pharmaceutical Industries Ltd For Target Rs.775.00 - Sharekhan

Key points

* The event:

The US Food and Drug Administration (USFDA) has lifted the Import Alert imposed on Sun Pharmaceutical Industries’ Mohali (Punjab) manufacturing facility, besides removing the facility from the Official Action Initiated (OAI) status. The USFDA had taken action against the company&r

16/03/2017 3:10:00 PM | Posted in Broking Firm Views - Long Term Report read full news
Neutral On Dr Reddy’s Labs Ltd For Target Rs.3,050.00 - Motilal Oswal

Duvvada formulations plant receives 13 observations in re-inspection

Risk of delay in Gleevec launch; regulatory concerns to weigh on stock price

* US FDA re-inspection of DRRD’s Duvvada-based oncology formulations plant got over yesterday. Post inspection, US FDA issued 13 483 observations.

* Though the obser

16/03/2017 3:04:34 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Wipro Ltd For Target Rs.599.00 - India Nivesh Sec

Wipro to Develop Next‐Generation Enterprise Master Patient Index (eMPI) Solution
for NHS Scotland

Wipro has won 12‐years contract from NHS Scotland to build a next generation Enterprise Master patient index (eMPI) solution. This solution will help NHS Scotland transition from its current legacy Community Health Index System (CHI) to offer co

16/03/2017 2:50:17 PM | Posted in Broking Firm Views - Long Term Report read full news
Update On Vivimed Labs Ltd - SPA Sec

Vivimed Labs is a Hyderabad based manufacturer focused on pharmaceutical and speciality chemical sector. Company has 11 manufacturing plants (eight domestic and three overseas) across three continents. The healthcare vertical is engaged in the custom manufacturing, APIs and formulations for leading generics-manufacturing companies. The specialty chemicals segment produces active ingredients for

16/03/2017 2:43:42 PM | Posted in Broking Firm Views - Long Term Report read full news
Sell Havells India Ltd For Target Rs.418.00 - Kotak Sec

HIL stock has appreciated sharply since our previous update (post Q3FY17 results). We believe that at current valuations (at PER 33.4x FY18 earnings) company's stock is trading expensive vis-à-vis and outperformance over the broader market is unlikely to last.

Havells board has recently approved the acquisition of Lloyd consumer durable business for an EV of Rs 16 Bn on deb

16/03/2017 2:32:08 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy KEC International Ltd For Target Rs.230.00 - Sharekhan

Key points

* Overseas order inflows driving growth:

After remaining lackluster in the last three years (with only 1.4% CAGR during FY2014-FY2016), KEC International’s order inflows have expanded by a significant 26% YoY to Rs8,634 crore in 9MFY2017. The strong growth in order inflow has been driven large

15/03/2017 4:09:15 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Escorts Ltd For Target Rs.596.00 - Motilal Oswal

Focus on improving market share

Levers in place to improve margins

* Escorts (ESC) improved its market share by 60bp in 9MFY17, driven by key strategic initiatives planned and executed in the last 3-4 years.

* It would continue to focus on increasing its share through deeper penetration and creating

15/03/2017 4:04:19 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold Gujarat Gas Ltd For Target RS.630.00 - RCML

Volume recovery in sight

In a recent meeting, GUJGA’s management indicated an improved outlook on volumes driven by (a) recovery in utilisation at some industrial units in existing areas of operation, (b) start-up of new ceramic and chemical plants, and (c) relatively low LNG prices. Volumes have improved to ~6.3mmscmd levels, up 1mmscmd over Q3F

15/03/2017 3:59:05 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Zee Entertainment Enterprises Ltd For Target Rs.580.00 - Sharekhan

Key points

* Advertising revenue to return to normal by Q1FY2018, margins to be ~30% comfort range:

Though growth in advertising revenue is expected to be muted in Q4FY2017 (as the key sectors like FMCG, Telecom, Auto and e-commerce have lowered their ad spends in the wake of demonetisation), the management ex

15/03/2017 3:52:30 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Shriram City Union Finance Ltd For Target Rs.2,500.00 - Motilal Oswal

Early signs of revival

Streamlining of MSME loan sourcing to help optimize cost structure

* Post demonetization, SCUF was impacted with disbursements growth slowing down to 10% YoY and GNPL rising 45bp to 5.4% (without RBI dispensation). However, the months of January and February have been good, with collecti

15/03/2017 3:42:12 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Fiem Industries Ltd For Target Rs.1,254.00 - Kotak Sec

FIEM is a leading player in automotive lighting/signaling equipment segment, catering largely to the two wheelers. The company also supplies rear view mirrors, sheet metals parts and plastic components to two /four wheeler segments. Recently, FIEM ventured into the LED lighting business. We expect the two wheeler industry to grow at a healthy rate over FY17- FY19E and FIEM would be a key benefi

15/03/2017 3:02:12 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Sun Pharmaceuticals Ltd For Target Rs.875.00 - RCML

Mohali import alert lifted; retain BUY

* Finally, some green shoots:

In a key positive development, the USFDA has repealed the import alert on SUNP’s Mohali plant which it acquired from Ranbaxy. The USFDA would also remove the plant from its OAI (Official Action Initiated) status received in Dec’12

15/03/2017 2:51:14 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold Mphasis Ltd For Target Rs.565.00 - Emkay

Downside risk to growth and margin expectations

* Management remains hopeful of achieving industry leading growth in the Direct Core International business with opportunity to tap business within the Blackstone portfolio to show early traction by H2FY18E, though we note recent moderation in growth here

* HP Business stable; Digital Risk could

15/03/2017 2:43:11 PM | Posted in Broking Firm Views - Long Term Report read full news
Update On Natco Pharma Ltd - Sharekhan

Key points

* Delivers strong 52% return since initiation; maintain positive view with another 10% upside:

We had initiated a viewpoint on Natco Pharma (Natco) on June 8, 2016 on expectation of an exponential growth on the back of a strong product pipeline. In line with our assumption, the company has posted a

14/03/2017 3:24:11 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Mindtree Ltd For Target Rs.560.00 - Emkay

Stability at top clients to aid margin improvement

* Mindtree remains focused on improving operational performance after the setbacks in CY16. Decline in business at top clients was a function of client specific issues with the decline mostly behind. Company confident of it’s competitive positioning within the top clients.

* Deal pipeli

14/03/2017 3:20:08 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold Oil India Ltd For Target Rs.352.00 - Sharekhan

Key points

* LPG under-recoveries increase sharply - upstream PSUs to bear nil subsidy in Q4FY2017 but FY2018E net oil realisation could be impacted:

As per the Petroleum Planning & Analysis Cell (PPAC), LPG under-recoveries have increased sharply to Rs270/cylinder for March 2017 and Rs184.3/cylinder for F

14/03/2017 3:09:02 PM | Posted in Broking Firm Views - Long Term Report read full news
Reduce On Bharti Airtel Ltd For Target Rs.306.00 - Emkay

Consolidation continues

* Bharti Airtel has signed definitive agreement to acquire Telenor India. Transaction is valued at ~Rs30-35bn with no cash outflow. It includes spectrum liability (Rs16bn), tower leases and asset value (Rs2.4bn) while no business debt would be part of the deal.

* Telenor has operations in 7 circles with revenue market

14/03/2017 3:01:45 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Finolex Cables Ltd For Target Rs.525.00 - Sharekhan

Key points

* New product launches to be growth drivers:

The FCL management reiterated that the new products like switchgears, water heaters and fans to be the growth drivers for the company. The management stated that the company has a strong presence in the cable segment in the southern markets and intends to

14/03/2017 2:55:00 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy Suzlon Energy Ltd For Target Rs.23.00 - Emkay

Wind tariffs become more competitive

* The results for first 1GW wind auction are out with tariffs at Rs3.46/unit. We interacted with two wind power developers who secured 50% of these orders. The developers are confident of sustainable IRR of 14% at this bid price.

* To achieve desirable IRRs, the developers would install wind turbines which

14/03/2017 2:50:53 PM | Posted in Broking Firm Views - Long Term Report read full news
Hold UltraTech Cement Ltd For Target Rs.4,020.00 - Sharekhan

Key points

* NCLT sanctions Jaypee group’s 21.2mtpa plant acquisition:

The National Company Law Tribunal (NCLT) Allahabad bench has sanctioned the scheme of arrangement whereby the Jaypee group’s 21.2mtpa cement plant will be transferred to UltraTech Cement (UltraTech) on a slump exchange basis. Ul

14/03/2017 2:44:17 PM | Posted in Broking Firm Views - Long Term Report read full news
Buy NIIT Ltd For Target Rs.110.00 - Emkay

Structural thesis intact

* Our structural thesis on NIIT remains intact despite the soft performance in the past 2 quarters caused by one time hits in the Corporate (CLS) segment (one existing client filed for Chapter 7 bankruptcy) and mix impact and Demon led pressure in the Skills (SNC) segment.

* We are enthused with the response received

14/03/2017 2:38:24 PM | Posted in Broking Firm Views - Long Term Report read full news
Accumulate Zee Entertainment Ltd For Target Rs580.00 - Emkay

Confident of outperforming industry growth; upgrade to ACCUMULATE

* We met the management of Z IN to get insights on advertisement outlook, content strategy and long term subscription revenue trend. Revamping programing hours on flagship Hindi GEC i.e. Zee TV in next 2 quarters is the key focus of the management.

* As per our data, the compan

13/03/2017 10:09:22 AM | Posted in Broking Firm Views - Long Term Report read full news
Hold ITD Cementation Ltd For Target Rs.168.00 - Emkay

Margins to improve going ahead

Result highlights

* ITD Cementation India’s (ITCE) Q4CY16 consolidated revenue was 15% below estimate but higher than expected EBITDA margins and higher other income led to in line profits.

* As per ITCE’s management, EBITDA margins should stabilize in the 9

13/03/2017 10:02:11 AM | Posted in Broking Firm Views - Long Term Report read full news
Reduce On Havells India Ltd For Target Rs.380.00 - Emkay

Multiple challenges ahead; Rich valuation; Downgrade to Reduce

* Havells India has acquired the consumer durable business of Llyod Electric for Rs16bn (valued at 0.86x FY17E sales – Rs18.5bn). This marks Havells’ entry in the large appliance segment. The acquisition is funded by a mix of debt and internal accruals.

* The deal enta

13/03/2017 9:38:08 AM | Posted in Broking Firm Views - Long Term Report read full news