Analyst Calls: Mahindra Logistics, L&T Infotech, L&T, Ambuja Cement
ICICI Securities has maintained its buy rating on Mahindra Logistics with a target price of Rs 462.
The domestic stock market on Tuesday showed early signs of a possible breakout from its consolidation range. And Nifty futures on Singapore traded 56 points lower this morning, signalling a weak start for Dalal Street.
As you head for the day’s trade, here is a compilation of overnight analyst calls on various stocks.
• ICICI Securities has maintained its buy rating on Mahindra Logistics with a target price of Rs 462. Better service mix should aid in higher gross margins, while increasing automation should lead to both better service offerings and operating leverage, according to the brokerage. The management continues to wait for a reversal in slowdown in the auto segment, but at the same time, is confident of growing in other verticals like e-commerce, pharmaceuticals and consumer, it added. The stock ended 4.81 per cent to Rs 370.30 on Friday.
• HDFC Securities has maintained its buy rating on L&T Infotech with a target price of Rs 1845. LTI’s strong pedigree is reflected in its broad-based vertical presence with marquee accounts, strong client mining programs and large deal portfolio, and leading margin/return metrics versus peers, said the brokerage. Client specific challenges have probably troughed and large deal trajectory is expected to improve growth momentum hereon. The stock rose 7.5 per cent to Rs 1612 on Friday.
• Anand Rathi has maintained its buy rating on Larsen & Toubro and raised its target price to Rs 1,860. The stock trades at 17.5 times FY21 estimated PE, and the target price is based on a target PE of 20x FY20 estimated EPS of Rs 93. Wage hikes, hiring and lower utilisation ate into the EBIT margin, which was down 43bps q/q to 15.5 per cent, said the brokerage. Three new deal wins of $100m TCV and the healthy deal pipeline offer assurance of growth. The stock ended at Rs 1448 on Friday.
• Dolat Capital has upgraded the recommendation on Supreme Industries to accumulate with a target price of Rs 1441. Considering the buoyancy in the piping segment, the brokerage expect Supreme Industries volume and revenue growth trajectory to improve from heron. Key factor to watch out will be the gross margin pattern. PVC prices will be the key monitorable, said the brokerage. The stock ended at Rs 1227 on Friday.
• Reliance Securities has maintained its buy recommendation on Ambuja Cement with a target price of Rs 233. Looking ahead, likely commissioning of clinker unit in 2021 will be a catalyst for the stock, which will ease the concern over capacity constraint, said the brokerage. Further, absence of incentives for its Maharashtra unit from Apr’20 will impact its profitability, which is expected to be recovered with likely pick-up in realisation and cost savings initiatives, it said. The company’s decision to amalgamate its WOS, ‘Dirk India Pvt’ is a cost-saving initiative during the quarter. The stock ended at Rs 207.65 on Friday.