Sunday, 28 August 2016

Re: {LONGTERMINVESTORS} Research Reports extracts & summaries - Thread

CLSA ON TATA MOTORS: ET NOW
* Raise target to `635 from `545, Maintain Buy
* FX losses impact JLR's margins but should bounce back
* Expect JLR's margins to climb to about 16% over FY18-19
* India business continued to improve; 2nd quarter of profit
* Volume growth outlook remains strong given a robust product pipeline
* Expect a strong 21% EPS Cagr over FY16-19; Up EPS by 4-6%

KOTAK ON TATA MOTORS: ET NOW
* Raise target to `580 from `520, Maintain Buy
* JLR reported a slightly weaker quarter due to higher FX losses
* JLR EBITDA margin will steadily improve as FX hedges move close to spot rates
* JLR volume growth outlook remains strong led by F-Pace and Discovery Sport
* Increased our consolidated earnings estimates by 10-11% over FY2017-19
* Build in currency benefits in JLR and change our GBP:USD rates to spot rates

AXIS CAPITAL ON TATA MOTORS: ET NOW
* Maintain Buy, Target `580
* Profit share of China JV remains strong at GBP 51 mn which is key positive
* Maintain view that rising share of Jaguar will not be margin dilutive
* Management expects JLR's volume growth to remain robust driven by new launches
* Factor in 20%/14% growth for FY17E/18 mainly driven by Jaguar

JP MORGAN ON TATA MOTORS: ET NOW
* Maintain Overweight, Target `485
* JLR demand outlook remains encouraging; India CV sales to pick up in 2H
* Overweight as new model launches are expected to drive growth at JLR
* As the hedges roll, benefit from the weaker GBP should reflect in margins from 2H

MACQUARIE ON TATA MOTORS: ET NOW
* Raise target to `600 from `535, Maintain Outperform
* JLR adjusted EBITDA margin of 13.8% despite weaker geographical mix
* Expect JLR to register strong volume growth over FY16-18 led by new models
* Our FY17-18 EPS estimate is ~15% higher than Bloomberg consensus
* India business is expected to report growth across segments in FY17
* Raise our TP by 12% on higher JLR valuation multiple to 3.5x FY18E EV/EBITDA from 3.2x

DB ON TATA MOTORS: ET NOW
* Raise target to `500 from `380, Maintain Hold
* Positive outlook on new models and FX, but risk-reward is balanced
* Gains from new models/FX should step up in coming quarters
* Currency could more than offset any negative volume impact in the near term
* Our target price of `500 is based on 4x FY18E EV/EBITDA

CS ON LUPIN: ET NOW
* Cut target to `1290 from `1450, Maintain Underperform
* Believe high contribution of Fortamet & Glumetza is underappreciated
* 3Q17 should be the first quarter of full impact of Mylan launch of Fortamet
* Expect 3Q17 to fully reflect weakness of base profit
* Expect further cut in consensus estimates; We are 8% lower than consensus
* Cut target as base business is only 40- 50% of total profits

DB ON HINDALCO: ET NOW
* Raise target to `185 from `176, Maintain Buy
* Supply side discipline better than expected so risk reward favourable
* Deleveraging on track; consolidated net debt falls for first time in seven years
* Upward revision of consensus earnings continues; sensitivity to LME high

MACQUARIE ON JUBLANT LIFE: ET NOW
* Raise target to `590 from `440, Maintain Outperform
* Speciality sales (CMO / Radiopharma) are the biggest margin lever
* Pharma business provides much-needed stability to margins
* Catalysts: Rubifill launch, FCF generation & deleveraging

MS ON INFOSYS: ET NOW
* Cut target to `1150 from `1231, Maintain Overweight
* Risks to F17 revenue guidance but largely priced in
* Macro uncertainty is affecting near-term business, but the deal pipeline is healthy
* After the recent correction, the stock is pricing in lower guidance
* We find the P/E multiple reasonable and downside potential limited
* Internal execution issues sorted out but external challenges have increased uncertainty
* Guidance to be revisited; likely cut in Oct-16 is already priced in
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