ITC, Tata Steel, AEL see highest EPS cuts in August; Grasim leads upgrades; targets

ITC Ltd, Tata Steel Ltd, Kotak Mahindra Bank Ltd, Maruti Suzuki India Ltd and Adani Enterprises Ltd (AEL) saw the steepest cuts in FY27 earnings per share (EPS) estimates in August. Grasim Industries Ltd, Bajaj Finserv Ltd, Hindalco Industries Ltd and State Bank of India (SBI) led the earnings upgrades among Nifty constituents, data showed.

During the month, 17 Nifty companies saw cuts in their FY27 EPS estimates. Among the larger sectors, three of the four metals & mining stocks and three of the five banking stocks in the Nifty saw earnings cuts, JM Financial said.

ITC saw a 10 per cent cut in its FY27 earnings estimate, followed by Tata Steel at 7.6 per cent, Kotak Mahindra Bank at 6.8 per cent, Maruti Suzuki India at 6.1 per cent and AEL at 6 per cent.

ITC's 12-month Bloomberg consensus target of Rs 325 suggested 23 per cent potential upside. Investec had a 'Hold' rating on the stock with a target of Rs 308 as of September 1. BNP Paribas had a 'Buy' rating with a target of Rs 380, while Morgan Stanley had an 'Equalweight' rating with a target of Rs 340.

Tata Steel's 12-month consensus target of Rs 219 suggested 20 per cent potential upside. Kotak Securities' target for Kotak Mahindra Bank of Rs 464 implied 9.7 per cent upside, while Maruti Suzuki India's target of Rs 15,913 suggested 23.5 per cent upside. AEL's target of Rs 3,773 implied 30.6 per cent potential upside.

Meanwhile, 23 Nifty companies, or 46 per cent of index constituents, saw upgrades in their FY27 EPS estimates during the month. Higher upgrades were seen in both oil & gas stocks, both cement stocks, the lone telecom stock, two of three infrastructure & ports stocks, and three of five auto stocks in the Nifty.

Grasim Industries saw the biggest upgrade, at 17.3 per cent, followed by Bajaj Finserv at 8.9 per cent, Hindalco at 4.4 per cent, SBI at 4.4 per cent and Titan Company Ltd at 3 per cent.

Grasim's target of Rs 3,837.50 suggested 16.8 per cent upside, while Bajaj Finserv's target of Rs 2,367 implied 19.6 per cent upside. Hindalco's target suggested 17 per cent upside, while targets for SBI and Titan Company implied 22 per cent and 8.5 per cent potential upside, respectively.