Share Market Highlights 28 February 2025: Bloodbath on D-Street; Sensex plunges 1.9% to 73,198, Nifty settles below 22,150
Jefferies On Crompton Cons
Buy Call, Target Price Rs480
In their Analyst Meet, Crompton Mgmt Discussed New Launches & Innovation Ahead Of Summer, Esp In Fans Vertical
Premium Fans Are Growing At 2.5x Of Non-Premium
This Vertical Is Now ~25% Premium Vs 12-15%, 5 Yrs Ago
Co Has Taken 4-5 Tranches Of Price Rises 1.0-1.5% Each In Past 5-6 Quarters
This Summer, Mgmt Expects Double-Digit Growth In Prem & BLDC Fans, & Single-digit In Mass Category
Est FY24-27 EPS CAGR At +22%; FY26 PE At 32x
MS On Crompton Cons
Underweight, Target Price Rs352
Crompton Launches Nucleus, An Advanced BLDC Platform
Launches Xtech, An Advanced Induction Motor Platform, To Strengthen Its Fans Portfoli.
Focus Remains On Expanding Premium Share In Overall Revenue Mix
Premium Fans Are Growing ~2x Faster Than The Avg Fan Market Growth Rate
Crompton targets To Increase Premiumisation Share To 40% Of Overall Portfolio
Nomura On Crompton Cons
Buy Call, Target Price Rs447
Co Recently Unveiled Its Two Cutting-Edge Platforms, Nucleus & Xtech
Aims At Driving Energy Efficiency & Smart Tech Integration In Consumer Electricals Space
Mgmt Highlights That New Platforms Are Very Scalable
Much More Durable On Electronics & More Efficient Than Peers
Co Can Offer Much Higher Warranty To Customers Than Peers
Price Hikes & Operating Leverage Should Drive EBITDA Margin From 11% In FY25 To 12.2% By FY27F
Leading To A Healthy 22% EPS CAGR
Nuvama on Crompton Cons
Maintain Buy, TP Rs500
The company reiterated that it is tracking well on its Crompton 2.0 strategy i
Focusing on-industry-leading PAT growth, arresting the decline in the lighting market; and and turning around Butterfly.
Aims to capture a larger share of the premium fans market
The industry’s BEE2.0 transition (in Jan-26) shall provide further market share gain opportunities for Crompton
Off to a good start for summer season
Company is evaluating three–four new categories for solar pumps
Butterfly Gandhimati rejig has been completed with a new team in place and aim is to achieve mid-teens growth
Nuvama on Coal India
Coal India Arm, Northern Coalfields, Announces Levy Of ‘Singrauli Punarasthapan Charge’ Of Rs300/t On Its Entire Volume From May 1, 2025
Cash Inflow Is Likely To Be Widely Used To Fund The Upcoming Land Acquisition Rehabilitation Programme
At One Of The Mining Areas In Singrauli Over Next Few Yrs
This Levy Would Lead To A Surge In Coal India FY26/27 EBITDA By 9-10%
Est Capex Of Rs170 bn In Each Of FY26/27 Mostly Incorporates Upcoming Capex On Rehabilitation Proj Of The Singrauli Area
Assuming 5x EV/EBITDA Multiple, The Fair Value Can Increase By Rs34/sh
MS On Coal India
Overweight Call, Target Price Rs525/sh
Coal India Introduces A “Singrauli Punarasthapan Charge” Of Rs300/t Across All Mines Of Northern Coalfields w.e.f May 1, 2025
Per Co,This Will Drive Expected Additional Revenue Of Rs38.8 bn
See This Is As A Positive Dvptt, As Levy Is 2.5% Of FY26 Revenue
Implies 8% Upside Risk To FY26 Earnings Estimate
Key To Watch Would Be If Co Is Able To Take Price Hikes Over &
Co Currently Forecasting 2% Growth In FSA Realisations
JPM on Coal India
Maintain Neutral, TP at 420 (from 395)
FSA price hike announcement-a positive surprise
Coal India anticipates additional revenue of Rs 3880cr
FY26-27 EBIDTA to rise by 8-10%
Price hike announcement partially addresses headwinds
Headwinds are from softening international thermal coal prices (and e-auction premium), market-share loss to captives, weaker production growth & evacuation (rake movement).
CLSA on Bajaj Auto
O-P, TP Rs 9473
Therefore, BJAUT expects its ICE volume to grow ahead of the industry, which would translate into double-digit revenue growth, apart from the e2W volume growth of 20-30%
BJAUT highlighted that export volumes are on a recovery path
CLSA on Power Financiers
Expect Cos to increase their provision coverage ratio on discoms in 4Q25, but it should be range bound
Continue to be comfortable with asset quality
KSK Mahanadi write-backs are expected in coming quarters
Jefferies On Jubilant
Buy Call, Rs1,000/sh
Be Bold” Theme Underscored Growth Mindset
Tech Is Touching Entire Co, With Store, AI Emerging As A Differentiator
Recent Double-digit SSS Growth Was Fueled By Innovations
While Margin Guidance May Fall Short Of Some Expectations
Remain Excited About Growth Agenda
Mgmt Believes This Is Just The Start, Margin Should Follow Growth
MS on Jubilant Food
OW, TP Rs 781
Jubilant Food Mgmt Showcases How They capitalise On Tech Business
From Sourcing To Supply Chain, From Network Expansion To Store Efficienc
From App Management To Delivery To Consumer
Like Pivot To Building Platforms To Secure Higher Growth
Jefferies On Coforge
Buy Call, Target Price Rs10,100/sh
Post Recent 22% Fall, Coforge’s Stock Is Trading At An Attractive 33x FY26 P/E
Led By Strong Top-Line Growth, Improvement In Operating Margin & b/s Deleveraging
Consistent Revenue Growth Out-Performance Is Likely
To Continue, Given Strong Order Book & Consistent Execution
Coforge Remains High-conviction Pick Within Indian IT
Investec on Life Insurance
Upgrade ICICI Pru Life to Buy from Hold, TP at 725
Upgrade to due to valuation comfort
Majority of the headwinds are in the rearview – clarity on taxation, palatable surrender value tweaks, and softening of competitive intensity from unlisted players.
Expect listed private life insurers to deliver VNB growth of 13-16% over FY25E-FY28E.
Current valuations are attractive (implied VNB growth expectations of just 5%-12% over the next 10Y).
Listed private life insurers have also delivered healthy return on capital (17%-28% over the past ~20 years)
UBS on OMCs
Crude in mid $70s indicates healthy integrated margins
High crude premiums and narrow light heavy spreads to impact profitablity (Limited disruption)
LPGs under-recoveries continue
HPCL most levered for government grant
IOCL-Maintain Buy, TP 180
BPCL-Maintain Buy, TP 365
HPCL-Maintain Buy, TP 430
Jefferies on Apollo Hospitals
Maintain Buy, TP 7900
Sustainability of 5-7% ARPOB growth for Apollo in light of new bed additions in the sector is a key debate.
ARPOB concerns are unwarranted as bed additions for organised players are ~2% of their existing capacity
Additions will only be in a phased manner over 3-5 years.
Apollo has sustained 8.3% ARPOB CAGRover FY11-20 despite multiple headwinds
Alert-ARPOB means Average Revenue Per Bed
Jefferies on Real Estate
Supply catchup to support vols
Resi markets have started CY25 with value sales up 10%+; after a ~5% value growth in past 6-mths.
Supply declined 19% YoY in 2H24; with elections in base, expect rising supply in 2025.
Revival of mid-segment launches and still low vols in several cities vs. previous cycle should support demand.
Realty stocks are trading below average NAVs and recent promoter buying from open market signals confidence in underlying business.
Prefer DLF, Godrej Properties and Lodha
UBS on Thermax
Initiate Buy, TP Rs 4100
A diversified & sustainable energy solutions provider
Profitable exposure to an expanding industrial energy efficiency market
Forecasts 25% earnings CAGR between FY24-FY27E & 27% FY27E RoCE
Capital allocation is key
HSBC On HDFC AMC
Hold Call, Target Price Rs4,350/sh
HDFC AMC’s Stock Return Has Outperformed Its Peers YTD On Back Of Mkt Share Gains In Most Of Its Large Schemes
In A Cyclical Downturn, See High Downside Risks To Our AUM & EPS Growth Est; Remain Cautious
Valuations Appears Punchy For A Muted EPS CAGR Of 11% Over FY25-27
HSBC On Vehicle Finance
Relative To Segments Like Microfinance Or Hsg Fin, see Manageable, & Fewer, Headwinds To EPS In This Space
Vehicle Financiers Remain En Route To Deliver Relatively Stable EPS Growth & Profitability Over FY25-27
Sundaram Home Fin & Cholamandalam Fin Remain Preferred, But Remain Constructive On M&M Fin Too
Chola Fin – Buy Call, Target Price Raises to Rs1,610/sh From Rs1,510/sh
