Deutsche Bank initiated coverage of United Spirits with a "buy" rating, citing its 53% market share in the Indian spirits market, the significant entry barriers to foreign players, and the benefits from its deal to sell a majority stake to Diageo.
The investment bank said Diageo Plc would bring "much-needed financial prudence" to United Spirits Ltd, which should improve profitability and cash flows.
Deutsche set its 12-month price target at Rs 2,700.
United Spirits shares were up 1.5% at Rs 1,788 as of 10:06 am.