Brokerage Views: Goldman Sachs, CLSA On Wipro; Bernstein On HDFC Bank And More

Wipro Ltd. and HDFC Bank Ltd. are in brokerages' focus as the index heavyweights announced earnings for the quarter and year ended March 2024. Goldman Sachs and CLSA maintained their rating on Wipro.

NDTV Profit is tracking what the brokerages are putting out on specific stocks. Here are all the top calls from the brokerages that you need to know about on Monday.

Goldman Sachs On Wipro

Goldman Sachs maintained a 'sell' rating on Wipro Ltd. and revised its target price to Rs 430 apiece from Rs 420.
Demand environment remains unchanged, the brokerage said.
Guidance implies about 1% to 1.5% QoQ revenue growth in Q1 FY25.
This guidance bakes in early revival in Capco business.
Revenue growth of Wipro will underperform its peers, Goldman Sachs said.

CLSA On Wipro

CLSA retains 'sell' rating on Wipro with a revised target price of Rs 431 apiece from Rs 445.
EBIT margin at 16% was better than CLSA's consensus estimates.
The guidance of -1.5% to +0.5% for the first quarter implies demand outlook remains weak particularly around discretionary spend.
Wipro is expecting improved growth outlook for its largest vertical BFSI, led by strong deal activity at Capco.
It will be a tough ask for the new chief executive officer to turnaround Wipro's fortunes, which have been weak for the last two decades now.
"We believe Wipro's new CEO has an advantage over his two previous predecessors as he knows Wipro's culture very well and is aligned with the founder's vision," it said.
Critical to watch is how will they incentivise the sales and marketing team while keeping overall cost escalation under control.
Order book has always been strong in the past but failed to reflect in revenue growth pickup due to a high leaky bucket of base business.
A further round of management churn, which could lead to further revenue loss to peers, can't be ruled out.

Also Read: Stocks To Watch: RIL, HDFC Bank, NTPC, Aditya Birla Fashion, Jio Financial, Wipro

Citi On Wipro

Citi Research has maintained a 'sell' rating on Wipro Ltd. and cut its target price to Rs 430 apiece from Rs 440, implying a potential downside of 5%.
Expects FY25 constant-currency revenue growth to be flat, the brokerage said in a note.
The BFSI is bottoming out post a tough FY24.
Wipro’s guidance and management commentary suggests caution on growth despite some green shoots seen in Capco.
Start of stability in BFSI led by Capco. Capco grew 6.6% on a sequential basis.

Also Read: Wipro Q4 Results: Profit Rises 6%, Meets Estimates

Bernstein On HDFC Bank

Bernstein maintains a 'buy' rating on HDFC Bank with a target price of Rs 2,100 apiece.
Bank delivered on the two key metrics that mattered the most — net interest margins and deposit growth.
Asset quality remains solid with non-performing assets and credit costs remaining very healthy.
Main concern from the results would be the lack of a meaningful increase in loan yields.
Adjusting for one-off return on assets was marginally lower at 1.88% and profit lower by Rs 7 billion.
Floating provisions were completely voluntary and not an indication of asset quality.

Also Read: HDFC Bank Q4 Results: Net Profit Flat, Provisions Surge Three Times

Kotak On Gujarat State Petronet

Kotak Institutional Equities downgrades Gujarat State Petronet to 'reduce' at fair of Rs 360 apiece.
Believes that a 20–30% tariff cut was due on higher actual volume.
Cuts FY25/26 earnings estimates by 28%/37%
Expects return on capital employed to decline sharply to 11–12% vs average 24% over FY19–23.

Nomura On Gujarat State Petronet

Nomura downgrades Gujarat State Petronet to 'reduce' from 'buy' with a target price of Rs 320 apiece.
Cuts FY25 and FY26 Ebitda by 37% and 42% respectively.
Tariff to be reviewed next fiscal if actual volumes show considerable variation.
Lower spot LNG prices may keep transmission volumes favourable in the near term.

Citi On Gujarat State Petronet

Citi Research maintains 'sell' on Gujarat State Petronet, cuts target by 11% to Rs 295 apiece.
Key reasons for cut: Lower capex, higher volumes, lower operating expenses.
Cuts FY25–26 standalone earnings by 25–27%.
Regulatory shock to create overhang for Gujarat gas despite lower transmission.

UBS On Voltas

UBS Research upgrades Voltas to 'buy' with a target price of Rs 1,800 apiece.
Voltas RAC and VoltBek joint venture improving market share and profitability.
Expects incremental revenue of Rs 100 billion in consumer electronics segment by FY27.
Values cooling segment at 55 times earnings vs 35 times earlier.

Also Read: Stock Market Live: GIFT Nifty Trades Above 22,200; Wipro, RIL, IREDA, NTPC In Focus