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Top brokerage calls for May 14: CLSA bullish on HDFC, raises TP; Deutsche Bank maintains 'buy' on ITC

Top brokerage calls for May 14: CLSA bullish on HDFC, raises TP; Deutsche Bank maintains 'buy' on ITC

Top brokerage calls for May 14: CLSA bullish on HDFC, raises TP; Deutsche Bank maintains 'buy' on ITC
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By CNBC-TV18 May 14, 2019 8:16:13 AM IST (Updated)

Among brokerages, CLSA maintained 'sell' on Vodafone Idea and cut the stock's target to Rs 12.50. Macquarie and CLSA were both bullish on HDFC post Q4 numbers. While CLSA raised the stock's target, Macquarie slashed TP to Rs 2,350.

Indian shares are expected to open lower on Tuesday following losses in global markets after US-China trade war escalated, with Beijing announcing retaliatory tariffs on US goods. Additionally, foreign outflows, rising oil prices, and the currency’s movement also dented market sentiment. Indian benchmark indices fell for the ninth consecutive session for the first time in eight years. The BSE Sensex and NSE's Nifty 50 fell around 1 percent dragged mainly by auto, pharma and PSU bank stocks.

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Among brokerages, CLSA maintained 'sell' on Vodafone Idea and cut the stock's target price to Rs 12.50. Macquarie and CLSA were both bullish on HDFC post Q4 numbers. While CLSA raised the stock's target, Macquarie slashed TP to Rs 2,350. Deutsche Bank and Citi had a 'buy' rating on ITC and raised its target price. Here are the top brokerage calls for today:
CLSA on Vodafone Idea
- 'Sell' rating, target cut to Rs 12.50 from Rs 27 per share
- Merger synergies boost EBITDA
- Operating metrics weak with slower-than-expected data adoption
- Raise FY20 EBITDA estimates by 9 percent
- FY21 gearing will be uncomfortable at 6.3x EBITDA
CLSA on HDFC
- 'Buy' rating, target raised to 2,500 from Rs 2,360 per share
- Superior access to funds will support growth and share gains
- Profit ahead of estimates with better NII and treasury income
- Loan growth should improve with an uptick in disbursements
- Expect a steady rise in core earnings and roe expansion
- Will see a 16 percent loan CAGR over FY19-21 driving earnings growth
Macquarie on HDFC
- Maintain 'outperform', target cut to Rs 2,350 from Rs 2,400 per share
- Growth slowdown led by corporate loans
- No deterioration in asset quality underscores underwriting prowess
- Cut FY20-21 EPS estimate by 1-5 percent as we lower NIM forecasts
Deutsche Bank on ITC
- 'Buy' rating, target raised to Rs 375 from Rs 350 per share
- Volumes improve further; margin improvement to follow shortly
- Cigarette volumes growth at 8 percent, highest in 30 quarters
- Cigarette margin down 73 bps as it’s consuming higher price leaf tobacco
- Pressure on cigarette margin expected to abate going forward
- High probability of rational tax increase
- Stock is cheap with significant premiumization potential
- Model earnings CAGR of 15 percent over FY19-22
Citi on ITC
- 'Buy' rating, target raised to Rs 370 from Rs 360 per share
- Cigarette business continues to deliver healthy volumes
- Raise EPS estimates marginally by 1-3 percent
- Trading below its 5-year mean P/E valuation and 30-35 percent discount versus peers
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