State Bank of India: State Bank of India (SBI) with its 18 per cent market share continues to be stable while strong liability franchise has enabled it to face the cost of funds pressure reasonably well. Gross advances were at 10.6 trillion with deposits were at 12.5 trillion as on June 2013.
Due to higher inflation, interest rates are expected to remain firm in the near term. In this environment of economic slowdown and high interest rates, banks like SBI will be able to manage funding and in spite of NPAs, profits may not erode substantially. ICICIdirect remains positive on the stock from a long term perspective
Bajaj Auto Ltd (BAL): It is the second largest two-wheeler manufacturer in India with a domestic market share of 15 per cent with products in all price segments.
BAL is also the largest three-wheeler manufacturer in India with domestic market share of 40 per cent. The nimble low cost structure, strong product and market focus remain key aspects, which differentiate BAL from its peers
With strong growth in ASPs likely due to increased exports and a better product mix, BAL is likely to post topline, bottomline growth of 10 per cent, 21 per cent CAGR, respectively, in FY13-15E, with margins likely to remain above 22 per cent for FY14E, FY15E.
The brokerage firm believes such high RoCE businesses with strong cash flow yields would continue to command a premium to the market and peers.
Wipro: Wipro is likely to return to industry average growth led by account mining initiatives and ramp-ups in large deals. A 2.5x rise in the number of US$100 million plus customers to 10 between Q1FY12 and Q2FY14 - two clients breached US$200 million run rate in Q2 - demonstrates considerable success of Wipro's account mining initiatives.
Further, utilisation (near its three-year low) improvements and focus on improving revenue productivity could help offset EBIT margin headwinds, if any, from the appreciating rupee
The management commentary suggests Q4FY14E quarterly exit rate could match industry average growth led by improved deal traction, win rates and the velocity of deal closures.
The brokerage firm expect sales, EBITDA and PAT to grow at a CAGR of 13%, 13% and 15%, respectively, in FY13-15E. The stock is currently quoting at 14.6x our FY15E EPS of 32.9.
Bajaj Electricals Ltd (BEL): BEL is a dominant play in the consumer durable (CD) and lighting segments with over 4100 dealers and a 400,000 strong retail network for lighting and 86,000 and 45,000 for fans and appliances, respectively, across India.
BEL recorded last six years sales CAGR of 25 per cent and 17 per cent in the CD and lighting categories, respectively, whereas the performance of the E&P category was dismal (last six year sales CAGR of 13%) with rising competition and cost overrun.
The brokerage expects the E&P segment to narrow its losses in FY14 and start contributing to EBITDA in FY15 by executing high margin projects. It will help reduce working capital requirements with improving return ratios, going forward. This will help the stock to command a higher multiple in future
Entertainment Network
Entertainment Network is the market leader in radio broadcasting with an approximate market share of 35 per cent and operates 32 radio stations across India. It commands a premium over its peers in terms of pricing as well as highest industry wide margins of 35 per cent.
In the wake of the slowdown in the economy and inflated TV ad rates due to their reduced inventory on account of Trai ad cap, the entire radio broadcasting industry is slated to benefit.
Advertisers are switching over to the cheaper mode of advertisement, which garners the same widespread audience at a lower cost outlay. The trend can be seen from impressive double digit ad growth (23.4% YoY in Q1FY14) posted by ENIL in the past quarters.
Due to higher inflation, interest rates are expected to remain firm in the near term. In this environment of economic slowdown and high interest rates, banks like SBI will be able to manage funding and in spite of NPAs, profits may not erode substantially. ICICIdirect remains positive on the stock from a long term perspective
Bajaj Auto Ltd (BAL): It is the second largest two-wheeler manufacturer in India with a domestic market share of 15 per cent with products in all price segments.
BAL is also the largest three-wheeler manufacturer in India with domestic market share of 40 per cent. The nimble low cost structure, strong product and market focus remain key aspects, which differentiate BAL from its peers
With strong growth in ASPs likely due to increased exports and a better product mix, BAL is likely to post topline, bottomline growth of 10 per cent, 21 per cent CAGR, respectively, in FY13-15E, with margins likely to remain above 22 per cent for FY14E, FY15E.
The brokerage firm believes such high RoCE businesses with strong cash flow yields would continue to command a premium to the market and peers.
Wipro: Wipro is likely to return to industry average growth led by account mining initiatives and ramp-ups in large deals. A 2.5x rise in the number of US$100 million plus customers to 10 between Q1FY12 and Q2FY14 - two clients breached US$200 million run rate in Q2 - demonstrates considerable success of Wipro's account mining initiatives.
Further, utilisation (near its three-year low) improvements and focus on improving revenue productivity could help offset EBIT margin headwinds, if any, from the appreciating rupee
The management commentary suggests Q4FY14E quarterly exit rate could match industry average growth led by improved deal traction, win rates and the velocity of deal closures.
The brokerage firm expect sales, EBITDA and PAT to grow at a CAGR of 13%, 13% and 15%, respectively, in FY13-15E. The stock is currently quoting at 14.6x our FY15E EPS of 32.9.
Bajaj Electricals Ltd (BEL): BEL is a dominant play in the consumer durable (CD) and lighting segments with over 4100 dealers and a 400,000 strong retail network for lighting and 86,000 and 45,000 for fans and appliances, respectively, across India.
BEL recorded last six years sales CAGR of 25 per cent and 17 per cent in the CD and lighting categories, respectively, whereas the performance of the E&P category was dismal (last six year sales CAGR of 13%) with rising competition and cost overrun.
The brokerage expects the E&P segment to narrow its losses in FY14 and start contributing to EBITDA in FY15 by executing high margin projects. It will help reduce working capital requirements with improving return ratios, going forward. This will help the stock to command a higher multiple in future
Entertainment Network
Entertainment Network is the market leader in radio broadcasting with an approximate market share of 35 per cent and operates 32 radio stations across India. It commands a premium over its peers in terms of pricing as well as highest industry wide margins of 35 per cent.
In the wake of the slowdown in the economy and inflated TV ad rates due to their reduced inventory on account of Trai ad cap, the entire radio broadcasting industry is slated to benefit.
Advertisers are switching over to the cheaper mode of advertisement, which garners the same widespread audience at a lower cost outlay. The trend can be seen from impressive double digit ad growth (23.4% YoY in Q1FY14) posted by ENIL in the past quarters.
today's Bajaj Electricals Ltd (BEL) open at 73.90 with a loss of -0.35 (-0.2%) so what is your prediction about this buy or sell please post here
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