Share Market Highlights 30 August 2024: Sensex, Nifty hit new lifetime highs; foreign fund inflows drive market rally


Nomura On Reliance Ind

Buy Call, Target Rs 3,600

Focused On Growth; Co To Double In The Next 5-7 Years

Launch Of Jio Brain And Jio Cloud To Lead The AI Integration Journey

See Robust Growth Across Segments Driving 3-year EBITDA CAGR Of 13%

EBITDA CAGR Will Further Be Boosted By A Sharp Increase In FCF Generation

EBITDA CAGR Will Further Be Boosted By Sharp Decline In Net Debt Levels

Jefferies on Reliance Ind

Buy Call, Target Rs 3,500

AGM Focused On Jio, With Traction In Airfiber, Foray Into Data Center

Co Expects Retail To Emerge From Tough Patch To Deliver Doubling Of Rev/EBITDA In 3-4 Yrs

Doubling Of Rev/EBITDA In 3-4 Yrs For Retail Is Ahead Of Our Estimate

New Energy Commissioning Could See Delays That Push Out Value Discovery To FY27

Board Will Consider A Bonus Issue

CLSA on Reliance Ind

Outperform Call, Target Rs 3,300

Co Targets To Double Its Size In The Next Six Years; No Hints About IPO For Jio Or Retail

Jio Aims To Add 1 m Airfiber Subscribers Every Month

Prioritising Investment Across O2C And New Energy Verticals

Macquarie on Reliance Ind

Neutral Call, Target Rs 2,750

New Energy The New Growth Engine, AI, Disney+, Bonus Shares

New Energy Division To Deliver Cash Flows That Are Less Cyclical

Potential Earning Capacity In Next 5-7 Yrs Similar To Existing O2C Business

Jio & Retail Targetting To Double Revenue And EBITDA In Next 3-4 Years

Jio Cinema Growth To Be Enhanced By Merger With Disney+ Hotstar

JioMart Hyperlocal Delivery With 1,300 Smart Points Noted As A Competitive Edge

Citi on Bharti Hexacom

Initiate Buy, Target Rs 1,405

Pure-Play Regional Telecom Operator With Healthy Balancesheet

Forecast A 3-Yr EBITDA CAGR Of 26% Vs 20%/22% For Bharti’s India/Mobile Ops & 24% For Voda Idea

See Net Debt/EBITDA Declining To 0.9/0.3x By FY26/27

Declining Net Debt/EBITDA Led By Strong FCF Generation

Declining Net Debt/EBITDA Opens Up Room For Upside To Payouts

Nomura on Lupin

Buy Call, Target Raised To Rs 2,427

Expect Improvement In Growth & Profitability Across Key Mkts, Likely To Attract Premium To Peers

US Generics Present Strong Support To Near-term Earnings

Co Has Gained Traction With A Few Complex Injectable Filings

Few Complex Injectable Filings Likely To Be Commercialised Over Next Two Years

There Are Specific Litigation-Dependent Upsides That Can Further Support Near-Term Earnings

Expect Narrative On US Prospects To Dominate Downside Risk In Specific Products Like Albuterol MDI

Factor In Higher Rev Contribution From Mirabegron In FY25 & Tolvaptan In FY26/27 Vs Earlier Est

Revise FY25/26 EPS Upwards By 28%/54%

MS on OMCs

Overweight Call On IOC, Target Raised To Rs 205/Sh

Overweight Call On BPCL, Target Raised To Rs 410/Sh

Overweight Call On HPCL, Target Raised To Rs 506/Sh

Global Tailwinds From Oversupplied Oil Markets Point To The Next Leg Of Outperformance

Gas Taking Market Share From Diesel In China Points To The Next Leg Of Outperformance

Domestic Tailwinds Of Strong Fuel Demand, Improving FCF Point To Next Leg Of Outperformance

HPCL Is Key Overweight, As It Exits An Investment Cycle, Followed By BPCL

Bernstein on Telecom

Outperform Call On Bharti Airtel

Target Raised To Rs 1,740 From 1,600

Telecom Has Seen A Favorable Market Structure Led By Consolidation Over Years

Strong Players – Jio & Bharti Airtel Continue To Gain Share With Jio (45%) & Bharti (37%) Rev Sh

Expect Market To Consolidate Further, As VI (Not Covered) Subscriber Churn Remains High

Jio Is On Path To Reach Nearly 500 Million Subscribers And A 50% Share

CITI on UPL

Buy, TP Rs 640

Co’s guidance of 4-8% rev growth & >50% EBITDA growth in FY25 does not factor in any improvement in pricing vs 4QFY24 level

With global destocking nearing completion, gross/contribution margins off trough believe a rerating is likely

Jefferies on Real Estate

Transient volume weakness

Resi markets slowed in June-July 2024 after a strong April-May; though vols in top 7 cities are still +5% FYTD.

Low inventory levels suggest that overall market remains healthy

Prefer Lodha, GPL, DLF, Sunteck

Macquarie on 2Ws

Growth on fast track, TVS top pick

Teens 2W industry volume growth in FY25E.

TVS’ diversified segment exposure, new E2W launches, & margin upside pose upside earnings risk

Macquarie on USL

U-P, TP Rs 1100

United Spirits saw another qtr of stronger YoY sales growth in prestige segment vs Pernod India albeit weaker than local peer, Radico Khaitan

While USL market share gains are encouraging, guided moderation in sales momentum in 2Q makes us cautious

HSBC on Maruti

Buy, TP Rs 14500

PV demand weakness is visible in increased inventory & discounting across OEMs and models

Not very optimistic for festive season this year & hence cut FY25/26 volume estimates for MSIL

However, stay Buy due to undemanding vals