"We see strong downside risk to the margins due to competition from new capacities and increased likelihood of leakage on volumes coupled with widening gap between A and C category brands. Stretched valuations with EV/EBITDA of 20x and P/E of 38x FY22E and flattening earnings growth leaves no scope for margin of safety," wrote analysts at Prabhudas Lilladher in its note dated February 17. They maintain 'reduce' rating on the stock with a target price of Rs 19,500.
Those at Motilal Oswal Financial Services (MOFSL), too, do not see any uptick in the stock as, they believe, its potential market share gains over the next three years are already priced in. They have 'neutral' rating on the stock.
The Kolkata-based cement manufacturer will replace private lender YES Bank
in the index. The bank was also excluded from the benchmark S&P BSE Sensex in December 2019. READ HERE
At 10:00 am, the lender was trading 0.86 per cent lower at Rs 34.75 on the NSE. The stock hit an intra-day low of Rs 33.6, down 4 per cent. In comparison, the Nifty50 index was trading 0.7 per cent higher at 12,076.
The stock of the bank has turned highly volatile over the past few months owing to various issues including its fund-raising plans. As per the latest communication by the bank, it has received non-binding expressions of interest (EoIs) from several investors including J.C. Flowers & Co, Tilden Park Capital Management, OHA (UK) LLP (part of Oak Hill Advisors), and Silver Point Capital.
The bank and its financial advisors are in discussions with these investors on commercial terms. The investments, including pricing and size of the stake to be acquired, are all subject to regulatory approval, the bank said in an exchange filing.
Besides, due to the ongoing talks with potential investors, YES Bank
has deferred the announcement of its December quarter (Q3) results till March 14, 2020. READ STATEMENT HERE
In the past three months, the stock has plunged 47 per cent on the NSE, as against a per cent rise in the Nifty50 index during the period.