2 Tata Group Stocks, 1 Large Cap Auto Stock Get Sell Call: HDFC Securities Recommends

HDFC Securities has assigned sell call to 3 large cap and mid cap stocks. These stocks are Bajaj Auto Ltd, Tata Elxsi Ltd, and Tata Motors Ltd. It is worth noting that Tata Motors and Bajaj Auto are large cap stocks operating in Auto sector while Tata Elxsi Ltd is a mid-cap stock operating in IT Software sector. Check details below:

1. Sell Bajaj Auto Ltd

HDFC Securities has assigned sell rating to Bajaj Auto Ltd with a target price of Rs 3857 apiece. The current market price of Bajaj Auto is Rs 3937.70 apiece with intraday gain of 5.93%.

The stock's 52-week high is Rs 4130 apiece and 52-week low is Rs 3125 apiece, respectively. The large cap company has a market capitalisation of Rs 1,13,944.05 crore.

The stock gave a return of 12% in last 1-year, 27% in last 3-years, and 19% in last 5-years. In last 1-week, Bajaj Auto surged 10% and again 10% in last 1-month.

According to the brokerage, "On the back of a better-than-expected Q3 performance, we have raised our FY23-25 earnings in the range of 3-5%. Maintain REDUCE, with a revised TP of INR3,857/sh (from INR3,743 earlier); core business is valued at 16x September 24 earnings."

2. Sell Tata Elxsi Ltd

The last trading price of the mid cap IT Software sector stock is Rs 6662.10 apiece with intraday gain of 0.99%. HDFC Securities has recommended investors to sell Tata Elxsi Ltd with a target price of Rs 6000 apiece. The stock's 52-week high is Rs 10,760.40 apiece and 52-week low is Rs 5,708.10.

It has a market capitalisation of Rs 41,489.19 crore.
It gave a return of 4% in last 1-week, declined 5% in last 3-months, and 4% in last 1-year. It gave 606% return in last 3-years.

According to the brokerage, "While TELX's valuation multiples have come off, it still remains above comfort levels (currently at 49x and 39x FY24E and FY25E earnings) factoring in 24% EPS CAGR over FY22-25E. At the current valuation, the implied USD revenue growth is >21% CAGR over FY22-32E. Maintain SELL on TELX with TP of INR 6,000, based on 40x Sep-24E EPS."

3. Sell Tata Motors Ltd

HDFC Securities has suggested investors to sell Tata Motors Ltd with a target price of Rs 415 apiece. The current market price of the large cap auto stock is Rs 445.55 apiece with intraday gain of 6.34%.

The stock's 52-week high is Rs 519.50 apiece and 52-week low is Rs 366.05 apiece, respectively.
The company has a market capitalisation of Rs 1,47,981.46 crore.

The stock gave 7% return in last 1-week, 4% in last 3-months, and 110% in last 3-years. In last 1-year, the stock fell 18%.

According to the analyst, "Going forward, benefits from an improved mix are likely to be offset by the expected rise in material costs. Incremental margin headwinds include: (1) the rise in employee costs as wage negotiations are due and they deploy more engineers to build future capabilities and (2) higher VME + FME for slow-moving models. Investments are likely to inch up to GBP3bn in FY24. Both the above factors would limit JLR's ability to pare debt. In India, the best of the PV and CV cycle seems to be behind, given rising inflationary pressures. Maintain REDUCE, with an unchanged TP of INR415/sh."

Disclaimer

The stocks have been picked from the brokerage report of HDFC Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.