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Analyst Calls: ICICI Bank, NTPC, Zydus Wellness, Essel Propack

Centrum Broking has maintained its buy rating on ICICI Bank and set a target price of Rs 635.

ET Bureau|
Dec 10, 2019, 07.28 AM IST
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ICICI Securities has recommended a reduce rating on the Zydus Wellness stock with a target price of Rs 1300.
Good morning!

The domestic stock market on Tuesday showed early signs of a possible breakout from its consolidation range. And Nifty futures on Singapore traded 1 point higher this morning, signalling a tepid start for Dalal Street.

As you head for the day’s trade, here is a compilation of overnight analyst calls on various stocks.

• Centrum Broking has maintained its buy rating on ICICI Bank and set a target price of Rs 635. ICICI Bank appears well-positioned to deliver healthy sustainable growth, aided by its expansion in digital offerings and continued investments in technology, according to the brokerage. The bank’s focus remains on granulising the existing corporate portfolio to reduce concentration and on continuing to originate high quality assets, e.g. in H1FY20, 89.5 per cent of the disbursements were made to corporates rated ‘A-‘ and above, said the brokerage. Shares of ICICI Bank ended at Rs 526.60 on Monday.

• Emkay Global has maintained its buy rating on NTPC with a target price of Rs 146 citing attractive valuations. At current market price, NTPC is trading at historically low valuations below 1.0x FY21E P/B and offers a dividend yield of 5 per cent. Regulated equity is expected to see a CAGR of 12.1 per cent over FY20-21E, said the brokerage. Shares of NTPC gained 0.22 per cent to close at Rs 112.80 on Monday.


• JM Financial has initiated coverage on Essel Propack with a buy rating and set a target price of Rs 90. For the immediate term, steady recovery in AMESA and East Asia Pacific should help drive earnings growth trajectory said the brokerage. JM expects ESEL to deliver earnings CAGR of 17.6 per cent over FY19-22E and scale-up its ROIC to 18 per cent versus 12.2 per cent at present. Stronger earnings growth and cash generation trajectory with much-improved governance standards make ESEL an attractive investment proposition, according to brokerage. Shares of Essel gained 0.5 per cent to Rs 154 on Monday.

• ICICI Securities has recommended a reduce rating on the Zydus Wellness stock with a target price of Rs 1300. Synergies from acquired portfolio, wider distribution network and negligible tax rates in the near term would allow Zydus to report 26 per cent earnings CAGR over FY19-22E. However, due to an increase in debt and equity, the return ratios of the company are at low single digit and would take a good five to seven years to reach double digit levels, said the brokerage. Shares of Zydus Wellness gained 2.9 per cent to Rs 1470 on Monday.
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