The Nifty50 has fallen by about 10 percent so far in May, partly weighed down by dismal results from India Inc. in March quarter and muted management commentary for the rest of the financial year.
Most analysts expect Nifty to remain range-bound in 8000-9900 band based on the analysis of potential earnings cuts for FY21 and FY22.
“Earnings continue to remain under pressure and our analysts have cut earnings estimates; Autos by 23-108% (ex-TTMT); Financials by 9-70%; IT Services by 8-20%; Consumer Staples by about 4-5%; and Energy by 10-30% for FY21 and an average 10% cut for FY22,” Amit Shah - Head of India Equity Research - BNP Paribas told Moneycontrol.
“We observe, however, the street has been behind the curve in terms of earnings cut, and that can further weigh on the market in the near term,” he said.
Shah expects the market to be range-bound in the near term with some downside risk in the range of 8000-9900. "Having said that, we think the worst is behind us and we do not see the market testing the March 2020 lows," he added.
CLSA maintained its buy rating on Nippon AMC but slashed its target price from Rs 380 to Rs 300 earlier. The company posted a sharp drop of 97.6 percent in its net profit at Rs 3.72 crore.
The global investment bank is of the view that volatility will remain which could impact the ability to regain market share. The asset under management (AUM) is down 12 percent led by weak performance in debt, liquid & equity funds.
Volatile markets in March reversed the market share gains. CLSA slashed its FY21/22 earnings by 16 percent but expect 16 percent AUM CAGR over FY20-22.
Morgan Stanley maintained its overweight rating on AU Small Finance Bank post-March quarter results but slashed its 12-month target price to Rs 2155 from Rs 2270 earlier.
The near-term challenges outweigh long-term opportunities, said the note. The company trades at a significant premium to peer small finance banks and private sector banks like ICICI Bank. The company has few levers in terms of capital raise/stake sale in Aavas.
Stock cash tips , Equity tips , MCX tips
For Quick Trial – 91091 93302
or mail us here: info@moneyplantresearch.com
or visit https://www.moneyplantresearch.com
+
No comments:
Post a Comment