HDFC BANK
Reco price/date: Rs 536/ June 20
Current/target price: Rs 542/Rs 622
There has been a strategic shift in branch distribution in the last three years, with the large rise in semi-urban branches. These branches contributed 53.5 per cent of the total branches added during the three years ended March 2012. Semi-urban and rural branches contributed 13 per cent to the incremental retail loan growth in FY12. The management believes the product range, service standards, technology and customer profiling would provide an opportunity for growth in new geographies, without compromising the asset quality. Maintain add.
Avendus Equity Research
BHARTI AIRTEL
Reco price/date: Rs 310/ June 21
Current/target price: Rs 312/NA
Airtel Nigeria (a subsidiary of Bharti Airtel), South Africa's MTN, Abu Dhabi's Etisalat and local operator Globacom, have paid a $3.7-million fine imposed on them by the country's telecom regulatory authority for poor quality of service. The regulator had tested the operators on four parameters - call set-up success rate, call completion rate, drop call rate and traffic channel congestion. The operators blame the bad quality of services on poorly developed infrastructure like electricity, which they say makes it cumbersome to deliver services to subscribers. Maintain neutral.
Angel Broking
CADILA HEALTHCARE
Reco price/date: Rs 721/ June 21
Current/target price: Rs 762/Rs 840
Edelweiss has upgraded Cadila Healthcare’s earnings estimates by six-seven per cent in FY13-14, led by upside from the domestic business, lower-than-expected drop in profit in the Hospira joint venture and margin expansion through cost optimisation. Analysts believe growth concerns in the US and the domestic market are behind. Moreover, the company’s focus on optimising cost should expand margins by 150-200 basis points in the next two-three years. Analysts are confident on the execution capability of the management and vision to invest in higher growth areas. FDA resolution in the near term will be a key positive, while drug policy implementation could be a negative. Upgrade to buy.
Edelweiss Securities
