Research Calls

CLSA Emerging Markets believes improved domestic demand and firm product prices will help TISCO improve on its profitability

Goa Carbon

Recommendation: Buy

Pioneer Intermediaries

Pioneer Intermediaries has recommended a Buy on Goa Carbon at a price of Rs 29. GCL has been consistently focussing on exports and currently exports more than 70 per cent of its production (calcined petroleum coke). GCL's consolidated revenues are expected to grow at a CAGR of 72 per cent from Rs 48 crore in FY01 to Rs 199 crore in FY03. Profits are expected to touch Rs 12.9 crore as against a loss of Rs 3.6 crore. The current price discounts GCL's consolidated estimated FY02E & FY03E EPS of Rs 8.7 and Rs 28.1 by 3.5x and 1.1x respectively making GCL's valuations compelling.

HDFC Bank

Recommendation: Downgrading

Salomon Smith Barney

Salomon Smith Barney has downgraded HDFC Bank to Neutral, while cutting their price target from Rs 280 to Rs 240. While HDFC Bank continues to deliver on fundamentals; loan growth exceeds 30 per cent, margins 30bps higher than industry's, strong fee income growth, good asset quality. Surplus capital has lowered its ROE well below its historical highs. Valuations, , remain at a significant premium to the sector. The bank's 'high growth, low risk model' stands out less in a fundamentally high-growth and improving asset quality environment but there could be disappointments on the growth front

J&K Bank

Recommendation: Buy

Motilal Oswal Securities

Motilal Oswal Securities has recommended a buy on J& K Bank at Rs 87. The brokerage house says the bank's perceived weakness has been its business strength. Its close relationship with the J&K government allows the bank access to large float funds. It mobilises low-costs deposits in the state and lends outside the state at competitive rates. The bank's asset quality remains amongst the best in the sector, even as it is diversifying outside J&K to de-risk its business model. The stock, which is trading at a forward P/E of 1.4x is touted an ideal mix of value and growth.

Tisco

Recommendation: Buy

CLSA Emerging Markets

CLSA Emerging Markets believes that there would be a strong rebound in the company's profitability from the second quarter of the current fiscal. This is expected to happen on the back of improved domestic demand, firm product prices and richer product mix. After a strong 20 to 40 per cent run since March this year, flat steel prices have stabilised, in international as well as local markets. However, prices are expected to plateau in FY04 and with further product mix enrichment, Tisco is expected to maintain an RoE of over 15 per cent.

Novartis India

Recommendation: Buy

Enam Securities

Enam Securities has recommended a Buy on Novartis India at a price of Rs 241, with a price target of Rs 300. The company has rationalised its operations by pruning its loss-making businesses. Focus has now shifted to revitalising mature brands. New product introduction in high growth therapies and possible brand acquisitions would drive growth. The stock trades at 9.9x FY04E earnings. Any price correction based on the perceived implications of the new drug policy should be used as an opportunity to take fresh exposure in the stock.