RBS on Aditya Birla Nuvo

RBS initiates coverage on Aditya Birla Nuvo with a `Buy’ rating and target price of Rs 1,050 per share. ABNL has a presence in a wide range of financial services, such as life insurance, asset management, non-banking financial services, wealth management, retail broking, private equity and insurance advisory. Birla Sun Life Insurance is the sixth-largest private life insurance company in India based on April-January ‘10 weighted new received premiums. Birla Sun Life Mutual Fund is the fifth-largest asset management company, with about Rs 68,100 crore of assets under management. The gross domestic savings rate increased from 23% in FY01 to 32.5% in FY09, with household financial savings forming a large part of that.

In addition, about 61% of the population is of working age. The target price is made up of:

1) the financial services group (insurance, asset management company and the listed AB Money Ltd)

2) the telecom business; and

3) the manufacturing businesses. Recently, the government announced its intent to consider giving banking licence to the private sector and NBFCs, subject to RBI approval. ABNL’s management has said that the group will apply for one.

Stock views on Siemens, Aditya Birla Nuvo, SAIL

Anand Rathi on SAIL - Target Rs 291

Anand Rathi Securities has recommended a buy rating on SAIL, with price target of Rs 291, in its report.

"We initiate coverage on SAIL with a Buy rating and a target price of Rs 291. SAIL is one of our top picks owing to its Indiafocused operations, aggressive capacity expansion, modernization and strong balance sheet," says Anand Rathi Securities report.


IndiaInfoline on Aditya Birla Nuvo - Target Rs 975

IndiaInfoline is bullish on Aditya Birla Nuvo and has recommended buy rating on the stock with a target of Rs 975, in its research report.

"Aditya Birla Nuvo has seen a sharp rally from the support zone of around Rs 870 and has managed to cross the critical resistance levels of Rs 910-915 with impressive volumes. It has formed a medium term bottom around the above mentioned levels. Volumes accompanying the breakout are encouraging, thereby adding confirmation to the bullish outlook. MACD is in positive zone and has given a bullish crossover. The weekly RSI is exhibiting positive divergence. Based on the above-mentioned technical evidences, we recommend traders with high risk appetite to buy the stock in the range of Rs 910-930 for a target of Rs 975. A stop loss of Rs 895 should be maintained on all long positions."


Indiainfoline on Siemens - Target Rs 655

Indiainfoline is bullish on Siemens and has recommended buy rating on the stock with a target of Rs 655, in its research report.

"On the daily chart, Siemens has given a bullish breakout. It suggests that its short-term trend has turned up. Over the last eight weeks, the stock was consolidating in the range of Rs605-540. On Thursday, the stock crossed above the upper end of this trading band. The upmove was well supported by healthy volumes. Further, supportive technical oscillators are also positive. We recommend traders to buy the stock at current levels and on declines to the levels of Rs 610 for an initial target of Rs 655. It is advisable to maintain a stop loss of Rs 597," says Indiainfoline research report.

Stock Views on Aditya Birla Nuvo, ITC, Divis Laboratories

Indiabulls Sec on Aditya Birla Nuvo - Target Rs 1035

Indiabulls Securities Research has maintained its buy rating on Aditya Birla Nuvo with a target price of Rs 1035.

"Aditya Birla Nuvo (ABNL) reported results, which are above our expectations. The Company's consolidated net sales registered a growth of 15.3% yoy in FY09. Most of the Company’s segments have displayed an improvement in Q4’09. Accordingly, we have upwardly revised our estimates, and it has resulted in an increase in our fair value estimate. Further, we continue to believe that the Company's growing Life Insurance and Telecom businesses along with the improving performances of its other businesses will provide long-term value to the shareholders. Thus, we reiterate our 'Buy' rating on the stock. We have valued the Company by using the sum-of-the-parts methodology; our fair-value estimate of Rs 1,035 suggests a potential upside of 17% from the current market price. Hence, we reiterate our 'Buy' rating," says Indiabulls Securities' research report.

Motilal Oswal on ITC - Target Rs 237

Motilal Oswal has maintained its buy rating on ITC with a target price of Rs 237 in its research report.

"The stock has appreciated by about 12% in the last couple of trading sessions – perhaps the highest rise in reaction to budget pronouncements in recent times. We remain positive on ITC’s long-term prospects. We have upgraded our FY10E EPS to Rs 10.2 (Rs 9.9 earlier) and FY11E EPS to Rs 11 .6 (Rs11.3 earlier), factoring in no excise increase and removal of fringe-benefit tax (FBT). Maintain Buy with FY11E SOTP value of Rs 237," says Motilal Oswal's research report.

Sushil Finance on Divis Lab - Target Rs 1490

Sushil Finance has recommended a buy rating on Divis Laboratories with a target price of Rs 1490 in its report.

"In spite of the economic slowdown, DLL has managed to maintain its above average industry margins in FY09. DLL does expect some pressure on its Custom Chemical Synthesis Business (CSS) business but is banking on API sales of Levirecetam, lopamidol & nabumetone which will offset the slowdown in other businesses. Seeing the growth prospects & above industry average margins the stock deserves to trade at higher multiple. At the CMP, the stock trades at 13.3x its FY11E earnings. It has recommended buy rating on the stocks, target of Rs 1490," says Sushil Finance's research report.

Stock Views on Areva TD, ONGC, Aditya Birla Nuvo, Ultratech Cement, Allied Digital

CITIGROUP on AREVA T&D INDIA - TARGET PRICE: RS 1,809

CITIGROUP Global Markets has assigned a ‘hold’ rating to Areva saying despite the company’s strong fundamentals, the stock is fairly priced. “The stock trades at a P/E multiple of 19.7 times 2009 (estimated) earnings and provides limited upside to our target price of Rs 1,809. Our target price is based on a P/E multiple of 23 times December 2009 set at a 9.5% premium to historical average P/E multiples and in line with ABB,” the Citigroup note to clients said. Citigroup expects Areva’s earnings per share to grow at a compounded annual rate of 32% over 2007-10 (estimated), with a return of equity of around 40%. In comparison, ABB’s EPS is expected to grow at a compounded annual rate of 25% with a RoE of roughly 30%.


MACQUARIE Research on ONGC - TARGET PRICE: RS 995

MACQUARIE Research Equities has given a ‘neutral’ rating to ONGC, as it feels that attractive valuations are offset by lack of earnings growth. “ONGC is trading at undemanding valuations of 7.7 times FY3/09 (estimated), but it also lacks growth, as a corresponding rise in subsidy burden wipes out a bulk of its gain from a rise in oil price re-alisations,” the Macquarie note to clients said. Earlier this week, ONGC Videsh (OVL), the wholly-owned subsidiary of ONGC, had an-nounced a recommended preconditional cash offer to acquire Imperial Energy Corp, an oil E&P (exploration and production) company with assets in Russia and Kazakhstan for £1.4 billion.

Sharekhan on ADITYA BIRLA NUVO - TARGET PRICE: RS 2,035

BROKERAGE firm Sharekhan maintained its ‘buy’ rating on Aditya Birla Nuvo even though it feels that the firm may have overpaid for its acquisition of Apollo Sindhoori Capital investments Ltd. “We believe ABN has paid substantial premium for the buy, considering the valuations at which the listed peers are trading and the bleak near-term outlook for the broking industry. Nevertheless, the acquisition provides ABN entry into broking business and may hold value in the long term,” the Sharekhan note said. “We remain positive on ABN on account of its presence across diversified businesses. In the near term, the stock would have the trigger on account of the insurance bill that is expected to allow higher foreign direct investment in the sector,” it added.

CLSA on ULTRATECH CEMENT - TARGET PRICE: RS 791

CLSA has resumed coverage on UltraTech Cement with a ‘buy’ rating and price target of Rs 791. It feels that while domestic prices should drop over the next 9-18 months due to an adverse demandsupply regime, UltraTech’s improving sales mix should keep blended realisations flat over FY08-11CL. “EBIDTA margin is set to fall due to higher cost but it will be the most moderate decline. Its 9% volume CAGR over FY08-11CL should help drive a 4% cash-earnings CAGR. At 5.8 times price/cash flow, downside is limited,” said the CLSA note.

Alchemy Share on ALLIED DIGITAL - TARGET PRICE: RS 1050

Alchemy Share and Stock Brokers has rated Mahashtra Seamless a ‘buy’with a price target of Rs 873. “With increasing activity E&P (exploration & production) in the oil & gas sector in India, demand for seamless pipes is expected to rise over 10% in the next five years. MSL, being the leader, the company will be the major beneficiary of this demand,” the Alchemy note to clients said. “Further, implementation of city gas distribution network (CGD) in 200 cities as planned by Gail will improve the outlook for ERW pipes. MSL, being one the two key players in ERW segment, is set to benefit from increased demand,” the note added.