We value HUL based on 45x P/E on Sep-20 EPS to arrive at TP of Rs 1,691. HUL was our top pick, but considering rich valuation and limited upside, we downgraded the stock in 1QFY19 to NEUTRAL. HUL reported another quarter of broad-based growth with revenues growing by 12.5% (exp. 13%) with adjustment of 1% fiscal refunds. Volume growth was healthy at 10% (exp. 9%) driven by rural recovery, favorable base (4% in 2QFY18) and market share gain. Robust margin expansion resulted in EBITDA/APAT growth of 20/23% (exp. 18/18%).

Another best-in-class delivery but largely in the price now HUL's 2QFY19 key operating metrics comprising volume growth of 10%, revenue growth of 12% and 160bps expansion in operating margin were undoubtedly strong and commendable but were all bang on expected lines and no more a massive positive surprise as such. We expect the stock to be more range-bound hereonwards. Focus would be more on what the volume delivery for 3QFY19 and thereafter would be, since double-digit volume growth' would be in the base from 3Q onwards. Management remains quite confident and upbeat; key commentaries: 1) Demand outlook is stable. 2) Rural growing ahead of urban....

TCS's Q2FY19 result was in-line with our forecast as regards reported US$ growth, EBIT and EPS. However, there was a slight miss as regards CC revenue growth which came at 3.7% QoQ (vs. our forecast of +4.5%) and EBIT margin improvement of +150bps to...

Double-digit Growth Finally, But Sustenance In FY20 Will Be The Hard Part After a gap of two years, TCS has got back to growing its revenues at a double-digit rate (YoY) in CC terms in 2QFY19 11.5%. Besides a better macro, TCS indicated an improvement in its market share that drove this performance. TCS indicated that double-digit growth will continue in 2HFY19, despite seasonality. We believe sustenance of this beyond FY19 will be a tough task in the weak global macro backdrop that seems to be developing in 2019, after a rather supportive one in 2018 (see our recent report Peaking Global Capex Cycle). In FY19, TCS has been the only Tier-1 Indian player, despite its large size, to deliver double-digit organic growth - expectations at the beginning...

11 October 2018 In line with its recent commentary, TCS managed to return to double-digit YoY CC revenue growth (+11.5% YoY; thanks to currency benefit of 120bp. PAT grew 22.6% YoY to INR79b (our TCS won deals with total contract value (TCV) of USD4.9b the same as last quarter. It expects to grow in double- digits for the remainder of the year, the ask-rate for which is not demanding. To grow 10% YoY CC in FY19, the CQGR required in 2H is 0.3%. To grow 10%+ YoY CC in each quarter, flat revenue in 3Q and 1.9% QoQ CC growth in 4Q should suffice. trade war and Brexit are potentially unnerving, TCS continues witnessing strong demand in the US, led mainly by BFSI and Retail. UK remains a complex geography, but is currently seeing demand in BFSI, Retail and even Manufacturing.

We recently organised a Management Meet of Abbott India (AIL) for our clients and came out with a positive note. We maintain Hold rating for AIL due to rich valuations. We maintain TP of Rs7,250 (earlier TP Rs7,250) based on 24x March'20 EPS of Rs302.2. AIL is committed to variety of services and has a value added model. We expect margins to improve post the launch of new products and with the company's thrust to the high-margin vaccine segment. Abbott in India has presence in 80-90% of the therapy areas. AIL's top 10 brands contribute 72% of its revenues....

However, recent sharp correction in the stock price has factored in most of the negatives. Hence, we maintain HOLD' rating on the stock with a revised target price of Rs 187 using the sum of the part (SOTP) valuation methodology. Higher crude oil prices drive revenue HPCL reported 26% YoY increase in net sales in Q1FY19 driven largely by higher crude oil prices. While domestic marketing sales volume rose by 5% YoY to 9.63 MMT, crude oil throughput surged 17% YoY to 5.45 MMT. Marketing sales volume growth was led by increased sales of motor spirit (Petrol) ( 6.9% YoY), high speed diesel (2.7% YoY), LPG (11.3%), aviation turbine fuel...

imported from Thailand with the initial rollout of frost-free models; the company plans to launch smaller-sized direct-cooling models later. launched washing machines in different categories of 7-12kgs across range and 12-year motor warranty v/s 10-year industry norm All front-load, fully-automatic machines come with inverter motors for power which has 15min/30min extra wash cycle and vents on top of the washing machine for better drying during monsoons A+++ rating for fully-automatic washing machinesthese are the top-of-the- line fully-automatic washers and are most energy efficient as per EU standards In our view, size of the washing tub is bigger than competition across Washer-cum-dryer models also being launched in top-end models. around 100 exclusive brand outlets and around 70% of its dealers (~16,000 touch points for Voltas) deal in other product categories and this network would be utilized by the JV.

ICICI Securities Ltd | Retail Equity Research Tata Motors' owned Jaguar and Land Rover (JLR) came out with volume numbers for September 2018. Total JLR retail sales were at 57,114 units, down 12.3% YoY. For the quarter i.e. Q2FY19, total JLR retail sales were at 1.3 lakh units, down 13.2% YoY. On a YTDCY18 basis, retail sales were down 4% YoY to 448,106 units. Furthermore, media reports suggest that JLR is taking a two-week shutdown at its Solihull (UK) plant to align itself with the global supply & demand scenario. Solihull is one of the major...

We lower our revenue/adj.PAT estimates for FY19E by 14%/46% to factor in sustained pricing pressure in key products in the US, delay in meaningful product launches, intense competition in generics, weak growth in Japan and higher input costs. We maintain our HOLD' rating on the stock with a revised rolled over target price (TP) of Rs. 849 based on 18.5xFY20E EPS (18xFY19E earlier). US pain continues; Expects recovery in FY20E Lupin's revenue growth remained flat YoY in Q1FY19 as strong 28% YoY growth in domestic formulation sales (~32% of sales) was offset by weak 26% YoY decline in US sales (31% of sales). The subdued...

The government has announced | 2.5 per litre reduction in petrol and diesel prices to lower the burden on customers due to rising crude oil prices. The central excise duty has been cut by | 1.5 per litre while oil marketing companies (OMCs) have been asked to absorb a cut of | 1 per litre. This move by the government will have a substantial impact on the profitability of OMCs with BPCL and HPCL profits declining ~28% and ~39%, respectively on an annual basis. The current action by the government has put a question mark on the free pricing mechanism for petrol and diesel by OMCs. This...

Strategy in-place to become a Total foods company' Britannia Industries Ltd (BIL), a flagship company of the Wadia Group, is one of the largest packaged food companies in India with presence in bakery & dairy products....

Order inflow grew by 143% yoy to Rs43bn and the company is favourably placed (L1) in additional orders worth Rs170bn. Order backlog too increased by 15% yoy to Rs1.17tn. BHEL is focusing on ramping up its executable order book (~Rs980bn) to achieve better operating leverage as Rs190bn worth of orders are slowmoving. We value the stock at a P/E of 15x on FY20E EPS and ascribe a target...

Petroleum and Natural Gas Regulatory Board (PNGRB) have announced the final gas pipeline tariff for Gujarat State Petronet (GSPL). The upward revision in tariffs was above our estimates. Pipeline tariffs increased 28% from | 26.58/mmbtu (~| 1.1/scm) to | 34/mmbtu (~| 1.4/scm) for the main high pressure pipeline against our expectation of 20% increase in tariffs. Subsequently, we increase our tariff estimates by ~7.5% from | 1.35/scm to | 1.45/scm from H2FY19 onwards. The tariff revision has led to an increase in FY19E EPS by 6.2% and FY20E EPS by 11%....

select a new MD & CEO and 2) request to RBI an extension for the MD &CEO; up to April'19 at least to review the FY19 audited results and a further extension upto Sept'19 (till AGM) to oversee transition 3) appointed Mr. Rajat Monga & Mr. Praloy Mandal as EDs as a part of a long term succession planning. However, the board has not been able to give a clear picture on the succession and further course for the bank. The timelines and uncertainty on approvals from RBI for both MD & CEO (should be difficult) and EDs will keep...

24 September 2018 received a positive opinion from CHMP for its Neulasta biosimilar for the EU market. BIOS/Mylan also have in place the EU good manufacturing practices (GMP) certification for their drug product and drug substance facilities. Biocon/Mylan would be the fourth team to receive a positive opinion for Neulasta for the EU market. Accord (subsidiary of Intas Pharma) and Coherus received a positive opinion in July 2018, followed by Sandoz (Novartis division) and Cinfa Biotech in September 2018. The global market size of Neulasta is ~USD4.5b (as of CY17; ex-US sales USD600m). Separately, the drug product facility was inspected in April-May 2018 and received the Establishment Inspection Report (EIR) in June 2018. Successful inspections at both its facilities imply minimal regulatory hurdles for sales of pegfilgrastim biosimilar in the US market. BIOS/MYL, leading companies vying for approval in the regulated markets are Apotex, Sandoz, Coherus, Pfizer and Dr.

ICICI Securities Ltd | Retail Equity Research Putting an end to the ambiguity around extension of Rana Kapoor, MD & CEO of the bank, RBI has curtailed his tenor that will now expire on January 31, 2019. The board is scheduled to meet on September 25, 2018 to decide the future course of action. The term of Rana Kapoor, was ending on August 31, 2018. The board and shareholders had approved Kapoor's extension for a period of three years while RBI's approval was awaited. RBI had been quite vigilant on these divergences in the asset quality review...

We lower our EPS estimates by 8% for FY20E to factor in continued pricing pressure in the base business and delay in company's key drug launches. Strong pending niche ANDA pipeline coupled with expected monetization of Specialty and innovation R&D; pipeline and potential out-licensing deals for its novel drugs are some of the key positives. Hence, we maintain HOLD' rating with a revised TP of Rs695. Weak US sales; Expected key launches to drive business going ahead GNP reported 8.4% YoY decline in consolidated revenue impacted by decline in the US business (down 33% YoY) owing to continued pricing pressure in the US and high base (marketing exclusivity of gZetia in...

Impact of Kerala floods weighs in the near term: Kerala floods have cost both humanity and economics. We believe banks and financial institutions may see the impact in the form of 1) rise in fresh slippages; 2) spike in involuntary credit costs (especially for SME/MSME/agri/ retail segments); and 3) weak credit offtake. Federal Bank has 32% of its advances and has...

We take Punjab National Bank (PNB) out from Under Review and assign an Accumulate rating since (1) growth remains an issue for the bank even though (2) asset quality issues are largely behind the bank. Growth remains an issue with (a) Management having guided for domestic credit growth of ~10% for FY19, which is moderate (b) International book degrowth will continue (c) PNB does not sit on an adequate capital buffer with CAR standing at just 10.3% even after recent capital infusion of Rs28.16bn from the union government (d) PNB remains a candidate for RBI's Prompt Corrective Action regime given it still stands in breach of the relevant NPA threshold. Asset quality problems are largely behind the bank with (a) SMA exposure (which PNB considers its watchlist) standing at Rs80bnRs100bn (b) Exposure to various erstwhile restructuring dispensations (including 5/25)...