CLSA Initiates Coverage on Tata Motors CV with Outperform Rating, Sets Target at Rs 673
Global brokerage firm CLSA has commenced its coverage of Tata Motors Commercial Vehicles (TMCV) with an outperform rating and a target price of Rs 673. Analysts highlighted that the stars are aligning for the company as both India and Europe are entering a commercial vehicle (CV) upcycle, which is expected to drive a robust rebound in volumes and margins.
Robust Free Cash Flow and Strategic Synergies Expected
CLSA anticipates that TMCV will generate strong free cash flow (FCF) over the next two years, aiding in leaner balance sheets by FY28. This projection holds even after accounting for debt from the €3.8 billion Iveco acquisition. Following three subdued years, Iveco volumes are poised to accelerate on a lower base ahead of the Euro 7 transition in FY28-29.
Moreover, as electric vehicle (EV) adoption in light commercial vehicles (LCVs) gains momentum across India and the European Union, the TMCV-Iveco combination is set to deliver significant scale and supply-chain synergies. This merger provides a strategic advantage to the consolidated entity, positioning it well in the evolving market landscape.
Bernstein Maintains Underperform on Bajaj Finance, Raises Target to Rs 840
In other brokerage updates, Bernstein has maintained its underperform rating on Bajaj Finance but increased the target price to Rs 840 from Rs 750 previously. Analysts noted that near-term credit cost concerns have been alleviated, with accelerated provisions in the third quarter of FY26 addressing key risks.
The company took a one-off expected credit loss (ECL) provision, helping to rebuild the provisioning coverage ratio (PCR) after a period of decline. While asset quality worries have eased in the short term, and a potential stake sale in Bajaj Housing Finance could offer an additional profitability buffer, challenges persist.
Concerns remain around sustaining earnings per share (EPS) growth above 20%, as net interest margins (NIMs) face ongoing decline pressures. Non-mortgage household credit penetration is already high, and growth in this segment is expected to remain moderate.
Other Brokerage Updates: PTC India, UltraTech Cement, and Kansai Nerolac
Elara Capital Maintains Buy on PTC India with Rs 210 Target
Elara Capital has upheld its buy rating on PTC India, keeping the target price at Rs 210. Analysts indicated that NTPC-led shareholding consolidation is in progress, pending regulatory and shareholder approvals. Strategic synergies are anticipated across the renewable portfolio and emerging opportunities within NTPC Green Energy.
A detailed strategic roadmap is likely to materialize post-board restructuring. Virtual power purchase agreements (PPAs) are emerging as a key opportunity, with PTC India well-positioned as a power trading intermediary. The company meets eligibility criteria for Renewable Energy Implementing Agency (REIA) designation, with the proposal currently under consideration.
Motilal Oswal Securities Maintains Buy on UltraTech Cement with Rs 15,000 Target
Motilal Oswal Securities has retained its buy rating on UltraTech Cement, setting a target price of Rs 15,000. Analysts highlighted that the company has consistently outperformed industry growth through organic expansion and strategic acquisitions, increasing its market share from approximately 16% in FY14-15 to about 28% in FY25.
UltraTech is executing multi-phase capacity additions to boost domestic grey cement capacity to 235.4 million tonnes per annum (mtpa) by FY28, up from 191.4 mtpa currently. Integration of acquired assets is progressing smoothly, with earnings supported by capacity ramp-up, cost efficiencies, and recovery in infrastructure and housing demand.
Macquarie Rates Kansai Nerolac Neutral with Rs 220 Target
Macquarie has assigned a neutral rating to Kansai Nerolac, with a target price of Rs 220. Analysts stated that the company is targeting profitable growth led by industrial and auto segments. It remains on track to achieve its mid-term plan and has no intentions to divest the decorative paints business.
Kansai Nerolac is focusing on innovation-led growth in auto coatings and aims to establish non-auto industrial paints as the third pillar of its growth strategy.
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