5 Stocks that are under buy radar of Bank of America Merrill Lynch

Since the election outcome, Bank of America Merrill Lynch has recommended buy rating on following stocks with 1 year investment horizon.

Voltas Ltd.

The brokerage house in its report dated 18th June 2014 has recommended a buy rating on the company with target price of Rs.282 in 1 year time frame. They expect sharply higher earnings per share (EPS). Branded AC unit turning profitable is biggest positive for the stock. Mechanical, Electrical & Public Health (MEP) turnaround and better mix will boost margins. Valuations are cheaper than peers and its historical peak.

CLSA Outlook on TCS Stock Price Misleading

CLSA recent report on TCS stock price target of Rs 2200 in medium term and it's potential to attain a market value of $100 billion over next few years is very misleading for investors in general as they might get into the stock at current levels which is exorbitantly high in our view. 

We believe all the good news in terms of currency depreciation and U.S recovery are largely discounted in the stock prices of all the IT companies in general as they have outperformed Nifty by as high as 50% since the start of this year. 

CLSA is recommending a stock which has gone up 20% in 7 trading session from 22nd Aug 2013 to 30 Aug and around 50% in 2 months from June end to August end. 20% and 50% upmove might not be very high for a small or mid sized company but for a company of size around 3,96,000 crores it is huge. In two months since the end of June this year it has added more than 1.2 Lakh crores of market value equivalent to entire Wipro.

	TCS	Infosys	Wipro(IT)	HCL Tech	Tech Mahindra#
Market Value	396000	178000	119200	72400	32000
Revenue	62989	40350	37688	25734	14500
Net Profit	13941	9421	6105	4099	1950

Brokerage Houses View on Hindalco Industries

With Q1 Fy 2014 results slightly disappointing, most of the global brokerage firms have published their ratings on the India's Largest Aluminium Company. Some have retained their previous rating while others have reduced their price target on the stock. 

Following is the list of brokerage houses and their rating and price targets for Hindalco Industries.

Sell IndusInd Bank: Recommends Citigroup

Citigroup has recommended a "sell" rating on IndusInd Bank with a target price of 455 rupees, citing stretched valuations.

The investment bank says IndusInd has transformed itself into a "unique" bank that is also a non-banking financial company (NBFC).

However, Citi adds that "future growth will likely be less dynamic, amid a tougher macro, and less unique" as other NBFCs are applying for banking licenses.

The stock has been a huge out-performer in the last 2 years and has more than doubled from 250 odd levels in June 2011 to 500 in May 2013. Going forward the credit growth is expected to slowdown due to slowdown in India GDP and capital expenditures which is expected to put pressure on Banks and financial institutions in general.

Morgan Stanley overweight on Infosys: Target 3300

Infosys, the second largest software exporter of India, has been doing quite well post it's second quarter result and has seen series of upgrades for the stock. InvestorZclub also recommended the stock in it's post "Contrarian Stocks to Buy in 2013". The stock has run up more than 30% since the recommendation was made at a price of 2300. 

In spite of the huge run up in Infosys stock since past couple of months, Morgan Stanley is still bullish and expects the price to further rise to 3300. It says "While the external environment has not changed materially, the internal operating environment at Infosys has improved significantly". 

Morgan Stanley, Nomura view on Bharti Airtel

Sanity seems to be returning back in the telecom sector after very long time. The consecutive failures of expensive airwaves auction, winding down of operation of Uninor and Siestama Shyam in select circles and gradual increase of call tariffs have made some of the stronger players like Bharti Airtel and Idea Cellular come back into the radar of investors and brokerage houses. 

Morgan Stanley has raised its rating on Bharti Airtel Ltd to "overweight" from "equalweight," while Nomura also raised its rating on Bharti, but to "neutral" from "reduce", citing a recent share price drop. 

Bharti Airtel being the largest telecom company in India with almost one third revenue market share, is expected to recover first and most with environment becoming more conducive for the operators.

Sell HDFC recommends Goldman Sachs

Goldman Sachs has downgraded HDFC's stock to 'Sell' from 'Neutral', revising the target price to 740 from 790,  as India's largest mortgage lender could face challenges in retaining market share and maintaining profitability amid rising competition in the housing finance sector.

The housing finance sector growth in India moderated to 16% yoy as of December 2012 against 25% CAGR during 2003 to 2012 sue to which the brokerage house expects HDFC's core earnings growth to moderate at 15% CAGR over FY13E-FY15E vs 19% in FY08-FY13E. The stock is currently trading at an expensive valuation of 3.6 times its 12-month forward core mortgage book.

CLSA Downgrades ONGC to Underperform

The recent run up in stock prices of both upstream and downstream companies in anticipation of steep hike in fuel prices has made these stock expensive which led to CLSA downgrading stocks like ONGC, IOC and HPCL.

ONGC has gained around 18% in past 20 days with an addition of 40,000 crores to its market cap which now stands at 2.62 lakh crores at the current market price of Rs 306. 

CLSA said the rally in these state-owned stocks on the back of hopes for a hike in fuel prices is overdone, given any sweeping changes to pricing would be hard to implement in a very busy political calendar in 2013.

Goldman Sachs view on India - 2013

Goldman Sachs raised India to 'overweight' from 'market-weight', citing growth recovery and inflation moderation ahead pegging December 2013 Nifty target at 6,600. 

Recent reform initiatives have created a sense of optimism among the domestic investor base for the first time in over a year, and the risk of policy missteps in 2013 has been lowered," said Goldman Sachs in a report.

The investment bank added that MSCI India's valuation was well below the 5-year average of 14.9 times, affording an attractive entry point into one of the stronger structural growth markets in the region.

Goldman Sachs View on Crompton Greaves

Goldman Sachs has upgraded Crompton Greaves to buy from neutral and has raised its target price to Rs 155 from Rs 120, citing better prospects of domestic orders and margins. 

The investment bank says the company would benefit from the balance sheet restructuring of state electricity boards and power sector reforms as over 25% of its revenues are driven by domestic power transmission and distribution capex. The investment bank also said that the company is trading at attractive valuations.

CLSA downgrades Infosys - Target price 1566

CLSA in its global research report said Infosys stock could fall 40% from the current levels in 12 months. The report has fixed the price target at Rs 1,566. The report further added that sector multiples are likely to keep de-rating. The recent appreciation in the Indian currency might prove negative for the sector as well as for Infosys and its prices could fall. A 4% strengthening of the rupee will hurt Infosys earnings by about 5%. And a 13% move in the rupee would reduce earnings by 17%. In the first half of the year 2012, most of the Infosys earnings came from the nearly 8% rupee weakening. 

ICICI Direct Research Report on Bharti Airtel: Recommend Strong Buy

ICICI Securities has become very bullish on India's largest telecom company Bharti Airtel and has recommended a strong buy on the stock with a target price of 420 which is good 37% appreciation from the current market price of 306 as on 13th July 2012. 

The brokerage report says "Using the DCF methodology for valuing Bharti and assuming a revenue CAGR of 7.9% in FY12-20E and a terminal  growth  of  3.0%  thereon,  we have arrived at a target price of  Rs 420. The risk reward seems to be favourable at this point. We rate the stock as STRONG BUY"

Morgan Stanley view on Tata Motors for 2012

Morgan Stanley has turned bearish on the India's largest CV maker, Tata Motors, and has lowered its year end target price for the stock to Rs 240 from Rs 291 and maintains its "equal-weight" rating on the stock. The market price of the stock at the close of the markets as on 6th July 2012 was 240.55. 

Veritas Research Report on RCOM, DLF: PDF

Veritas Investment Research, a Canada based equity research firm has pegged the actual worth of India's largest real estate company DLF and Anil Ambani owned second largest telecom company  Reliance Communications (RCOM) at Rs. 100 and Rs. 15 respectively.  

Veritas dubbed India’s largest realtor ‘a crumbling edifice’ in its March 2012 report and on 19th June 2012 the equity research firm, which torn apart Kingfisher Airlines’ financials last year — well before the world woke up to the reality of the doddering airline, has snubbed RCOM numbers and has recommended sell  on the stock with a target price of Rs. 15.

NIFTY to face resistance at 5125 - 5160 levels

Nifty after breaching of the last two months trading range has struggled to move past the 200 DMA (5103) during last week trade. The Nifty drifted lower after testing the 200 days SMA on Tuesday's trade. The corrective price action may continue until we see a faster retracement of the recent falls and a breach of the lower peaks and troughs formations.

Nifty has closed below the 61.8% retracement level (4950) of the December-February rally. In the process, it has also filled the previous rising gap area of 4980 formed on January 19, 2012. Sustenance below 4950 levels in the coming sessions will see the index eventually heading for a deeper retracement of the January-February rally to the extent of 70-75%, which projects major support near 4850-4800 area.

Barclays overweight on Bharti Airtel

Barclays has retained its "overweight" recommendation on Bharti Airtel, after the company announced its fourth quarter result, with a target price of 440 rupees.

The brokerage believes that improving subscriber additions could turn revenue growth dynamics in the company's favour. Also, the cancellation of some operators' second-generation licences will help competitive dynamics and allow Bharti Airtel the flexibility to balance pricing and volume. 

CLSA view on TCS

A better than expected result from India's largest software exporter, Tata Consultancy Services Ltd, have cheered the street but failed to impress one of the world's largest rating agency CLSA. 

Merrill Lynch bullish on IVRCL

Merrill Lynch Capital Markets bought additional 2.125 million shares of IVRCL Ltd. in a bulk deal today as on 16th April 2012 at Rs 70.83 apiece for Rs 15 crore through an open market transcation.

Last week, Merrill Lynch Capital Markets bought 1.6 million shares of IVRCL for Rs 11.83 crore.

Stocks to Buy in 2012: Broker's Report

Unicon Investment, a broker in Indian Stock Market, has recommended its top 10 stock picks for new year 2012. The list includes SBI , Yes Bank , Coal India , Jindal Steel & Power, BHEL, Larsen and Toubro, Opto Circuits India , Mundra Port and Special Economic Zone , Eros International Media and United Phosphorous. 

Top 10 Traded Stocks in India - A Report by Religare

Top trading stocks in India 2011 - 2012 : A Research Report by Religare, India's leading financial Institution.

Companies inside report: