Stock brokerages including Axis Securities, Motilal Oswal, Centrum Broking, and Nuvama Institutional Equities have come out with research reports on select stocks namely Ashok Leyland, Tata Motors, RBL Bank, APL Apollo Tubes. Here's what brokerages said about these counters.
Brokerage firm Axis Securities has a ‘Buy’ rating on Ashok Leyland stock with a target price of Rs 210 per share. According to the brokerage, Ashok Leyland remains well-positioned to benefit from a longish CV upcycle. It values the stock at 19x Jun’25E EPS (unchanged), implying an upside of 17%.
Analysts at Axis Securities said, “We remain positive on the long-term growth trajectory of the company with better margins led by operational efficiencies, material cost reduction program, softening of commodity costs, and pricing discipline, and expect 8% CAGR volume growth over FY23-26E. We forecast the company to post Revenue/ EBITDA/PAT growth of 11%/22%/34% CAGR over FY23-26E.”
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Brokerage firm Motilal Oswal has a ‘Buy’ rating on Tata Motors stock with a target price of Rs 750 per share. According to the brokerage, with JLR wholesales expected at ~400k in FY24 and favourable mix, JLR should easily beat >6% EBIT margin guidance. India businesses focus on margin expansion as volume growth is likely to moderate in FY24.
"Tata Motors should witness a healthy recovery as supply-side issues ease (for JLR), along with a better mix, lower discounts and operating leverage (for all 3 businesses). It will benefit from: a) the CV uptrend and stable growth in PVs, b) company-specific volume/margin drivers, and c) a sharp improvement in FCF as well as a reduction in net debt in both JLR and the India businesses," said Motilal Oswal.
Brokerage firm Centrum Broking has a ‘Buy’ call on RBL Bank stock with a target price of Rs 331 per share. In terms of growth, the brokerage sees clarity emerging on most fronts for RBL and also a scope for positive surprises going forward. “We bake in strong numbers in advances, NII, and PAT, with CAGR of 23%, 26%, and 36%, respectively over FY23-26E,” said the brokerage.
“We believe that RBL is well-positioned to deliver average RoAA and RoAE of 1.1% and 12% over FY24-26E. Current valuations (0.8x PB, 7x PE – 1HFY26) offer enough margin of safety. Importantly, the long EPS downgrade cycle (which started from FY20) is finally bottoming out in our view. Looking forward to FY24-26E, RBL will likely see the best earnings momentum in the sector with 36% EPS CAGR,” said analysts at Centrum Broking.
Brokerage firm Nuvama Institutional Equities has a ‘buy’ rating on APL Apollo Tubes stock with a target price of Rs 2,000 per share. According to the brokerage, the company has been able to fast gain dominant market share and evolve itself from an ERW player to a structural tubes player.
A robust distribution network, warehouses, and higher retail presence as well as SKUs are expected to improve APL Apollo Tubes' last-mile connectivity. "The company has structured its working capital and improved OCF. Better OCF has helped in reducing its debt profile and, hence, improved return ratios. The anticipated strong growth impels us to assign a target PE of 40x Q1FY26E to the stock," Nuvama said. However, while the company is aiming for enhanced value-addition, it thereby runs the risk of being the first-mover and is exposed to risks pertaining to the vagaries of the global steel market.
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