Brokerage Calls & Analyst Insights: Stocks in Focus Today
Here’s a breakdown of the latest analyst recommendations on some key stocks, including Maruti Suzuki, Tata Motors, and Bajaj Finance.
Maruti Suzuki: Mixed Views on Performance
CLSA:
- Despite higher sales, Q3 margins dipped due to increased promotional expenses.
- EBITDA margin stood at 11.6%, in line with consensus but lower than expected.
- Believes CNG vehicle demand will drive future growth.
Jefferies:
- Strong YoY growth, but EBITDA missed expectations.
- Passenger vehicle (PV) market share hit a 12-year low, as SUVs gain traction over hatchbacks.
- Exports remain a bright spot.
Macquarie:
- Q3 results were largely in line, but costs weighed on margins.
- Discounts, advertising, and forex fluctuations impacted performance.
- Keeping an eye on EV sales and pricing strategy.
Morgan Stanley (MS):
- Strong EBIT margins despite a weak demand environment.
- Exports surged 38% YoY, accounting for 18.4% of Q3 sales.
- e-Vitara (Maruti’s EV model) production is set to begin soon.
Tata Motors: Analysts Turn Cautious
Jefferies:
- First downgrade in 3.5 years due to multiple headwinds.
- JLR demand is slowing in China and Europe, impacting profitability.
- EV competition is heating up, and India’s CV & PV demand is also cooling.
Morgan Stanley:
- Q3 earnings were weaker than expected.
- JLR’s FY25 EBIT margin guidance remains intact, but revenue guidance was trimmed.
- Will reassess FY26 outlook after Q4 results.
Tata Motors, despite its recent successes, faces growing competition in the EV space. The company’s long-term strategy will be critical as global markets evolve. Analysts suggest that Tata Motors’ JLR segment needs to maintain stability amid shifting consumer preferences. Additionally, Tata Motors’ domestic commercial vehicle performance will play a key role in overall profitability.
Bajaj Finance: Strong Momentum Continues
Morgan Stanley:
- Lower stressed assets in Q3 indicate improving credit quality.
- Management expects even lower credit costs in Q4.
- 25%+ EPS growth in FY26 looks achievable.
Jefferies:
- Q3 profit rose 18% YoY, surpassing estimates by 5%.
- Loan growth of 28% fueled revenue expansion.
- CEO succession plan seems smooth, ensuring stability.
Nomura:
- Solid Q3, with 18% YoY profit growth.
- Lower-than-expected credit costs helped beat estimates.
- Strong asset quality and loan growth bode well for the future.
HSBC:
- Delivered across all key metrics in Q3.
- Broad-based loan growth and robust asset quality were key highlights.
- Sees premium valuation over peers as justified.
Other Key Analyst Calls:
- JSW Infra (Nomura – Reduce, ₹230): Q3 missed forecasts; higher costs weighing on returns.
- KPIT Tech (Bernstein – Outperform, ₹1,580): Strong quarter, growth in Asia driving momentum.
- Ambuja Cement (MS – Overweight, ₹675): Q3 volumes beat expectations, but costs offset some gains.
- MGL (Nomura – Neutral, ₹1,350): Q3 in line, expects 10% volume growth in FY26.