Frosty headwinds SEEN for EMs; India unlikely to be an exception
India not immune to outflow pressure, cut Sensex target to 25,000 from 27,000
Expect remainder of 2016 to be highly uncertain, markets to be volatile with downward bias
High probability of govt. following with a growth boost with a stimulus in the union budget
Sensex will trade at a PE of 16.9x for FY17 EPS and 13.9x for FY18 EPS
Top Picks: Aurobindo Pharma, BoB, BPCL, Godrej Consumer, Hindalco
Top Picks: HPCL, Nestle, NTPC, Petronet LNG, RIL, SBI, Sun Pharma & Tech Mahindra
CITI ON BHARAT FORGE
Maintain Neutral, Target `880
Walker Forge Tennesse acquisition to help broaden North American presence
Do not think transaction value of US$14m will significantly impact overall debt profile
Believe intent behind acquisition is to further penetrate into US market & gain more customers
Incremental orders & foray into newer segments would be a positive
MACQUARIE ON ZEE
MAINTAIN OUTPERFROM, TARGET `635
No major impact from demonetization, further clarity is expected in next few weeks
Possibility of advertisers deferring new launches, impacting near-term ad growth
Low original programming, poor execution & launch of marquee shows by Colors impacted mkt share
Viewership share of ZEE's network has increased from 12% to 16.5% in the last 4-5 years
Well placed to tide over uncertainty on ad growth & repercussions of TRAI's tariff order
MACQUARIE ON SHRIRAM TRANSAPORT FINANCE
Maintain Neutral, Target `1185
~65-70% of total collections in cash, severely impacted in last 9- 10 days
Continued currency shortage may impact collection efficiency in 3QFY17 to be hampered significantly
Disbursements have virtually come to a standstill and so has freight availability for its customers
Growth recovery seen 2HFY17 from better monsoon & increase in government spending now delayed
CS ON PETRONET LNG
MAINTAIN OUTPERFORM, TARGET `410
Expansion benefits flowing through; Kochi losses to fall as BPCL refinery ramps up
Kochi pipelines remain work-in-progress, could take at least two years to build out
Use-or-pay contracts for Dahej expansion ramped up in Oct-16, 100% offtake requirement fulfilled
Expect strong 22% EPS CAGR over FY17-19
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