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Informist, Friday, Sept. 19, 2025                                      Tel +91 (22) 6985-4000

Equity Alert: Kotak Equities cautious on aluminum cos on weak fundamentals

MUMBAI--1242 IST--Kotak Institutional Equities remains cautious about aluminum producers due to the downside risks to aluminum prices and weak fundamentals. "We find better risk-reward for ferrous players over non-ferrous players due to better growth visibility, supportive trade policies and superior return profiles," it said in its research report. 

The broking firm said the fundamentals are "fragile" for the aluminum sector due to lack of cost support, headwinds from US tariff-led uncertainties, and consequent demand destruction. Alumina prices are close to a two-year low and new capacities are expected to keep the market in structural surplus. Aluminum prices on the London Metal Exchange rose 5% in the last one month due to macroeconomic tailwinds from a weak dollar, rate cut expectations from the US Federal Reserve, and a likely de-escalation in trade wars, Kotak Equities said. 

The brokerage also expects aluminum demand to lose momentum in the second half of 2025-26 (Apr-Mar) due to the ongoing uncertainties about US tariffs and consequent destruction in demand. It estimates the global aluminum demand to slow down to 1.8% in 2025 and to 1.7% in 2026 from 3.7% in 2024.

Aluminum spot spreads are close to the record high of $1,690 per tonne hit in February 2022 on fear of supply disruption from the Russia-Ukraine war. "We estimate that 98% of global smelting capacity is profitable on a cash cost basis at current aluminum prices."  (Anjana Therese Antony)

Equity Alert: Nomura ups target price for GE Vernova on likely higher exports

MUMBAI--1108 IST--Nomura Global Markets Research raised the target price for shares of GE Vernova T&D India by 13% to INR 3,350 and retained its 'buy' rating on the stock. The brokerage raised the power transmitter and distributer's target price on expectation of higher export order inflow and a growth in the company's domestic order book.

Nomura Global also raised the company's earnings before interest, tax, depreciation, and amortisation margin estimates by 90-180 basis points over 2024-25 to 2027-28 (Apr-Mar). However, going ahead, the brokerage sees a gradual reduction in the company's pricing power due to increasing supply in the industry, leading to a gradual moderation in its gross margins. Nomura Global raised its earnings per share estimates on GE Vernova by 7-8% over FY25-FY28. Accounting for large export orders, the broking firm also increased the company's total order inflow estimate to INR 444 billion from INR 347 billion for the same period.

Shares of GE Vernova T&D hit an all-time high of INR 3,064 in early trade Friday. At 1104 IST, shares of the company traded at INR 3,056.90, up 2.4%. Nomura's new target price indicates an over 12% upside from the stock's Thursday close.

For FY26, the company's management expects a total base order inflow of INR 75 billion, excluding large export and high-voltage direct-current orders. The company expects its domestic market opportunity at INR 2.20 trillion in FY25-FY27 and FY28-FY30, each due to a large demand for high voltage direct current. It expects two of these orders, in South Olpad, Gujarat and South Kalamb, Maharashtra, to be awarded by FY26 and 1-2 high-voltage direct-current orders to be awarded annually over the next 5-6 years.

The company expects its high-voltage direct-current market opportunity at INR 1.8 trillion for FY25-FY30, accounting for 40% of the domestic market opportunity, Nomura said. The company sees its annual domestic market reaching INR 900 billion by 2030, up 3.4 times from 2022.

GE Vernova T&D expects its global market opportunity to expand to $175 billion from $80 billion in 2023, and forecast exports to account for nearly 30% of its revenue. The company expects base export order inflow to remain at $9 billion-$10 billion in FY26, similar to inflows in previous years.

The company expects to receive large orders worth INR 20 billion-INR 30 billion from its parent Grid Equipments, in addition to base export order inflow of INR 10 billion amid an "era of unprecedented demand for high-voltage direct-current systems in the European Union and West Asia, and the cost arbitrage advantage," Nomura said. The company approved resolution of related-party orders worth nearly INR 30 billion in FY26, after receiving large order inflows of INR 22 billion from its parent company in FY25.

GE Vernova T&D announced a capital expenditure of INR 2.5 billion, out of which, INR 1.1 billion is expected to be used for improving existing capacity and the balance amount will be used to set up new high-voltage direct-current and static synchronous compensator facilities. "We believe GVTD's current installed capacity is sufficient to execute the current order book and one HVDC order. However, the new facilities will enhance its revenue potential and enable it to execute the future orders," Nomura said.  (Eshitva Prakash)

Equity Alert: Adani group cos at 1-2 mo highs; SEBI quashes Hindenburg claims

MUMBAI--0958 IST--Shares of Adani Group companies surged in early trade Friday after the Securities and Exchange Board of India Thursday dismissed allegations by US short-seller Hindenburg Research regarding accounting manipulation claims against Adani group companies. Adani Total Gas, Adani Power, Adani Enterprises, and Adani Energy Solutions rose between 3% and 9%, ranking among the top gainers in the market. Most Adani stocks climbed to near one- or two-month highs, with Adani Total Gas touching a near three-month peak.

The market regulator said there is no violation of its listing norms as the disputed transactions do not qualify as 'related party transactions'. The regulator said findings of the investigation showed that the group's listed company Adani Ports and Special Economic Zone transferred funds as loans to Adicorp Enterprises, which in turn transferred funds as loans to another listed player, Adani Power. Subsequently, Adani Power repaid the loans to Adicorp Enterprises along with interest, which in turn repaid the loans to Adani Ports with interest, SEBI said.

In January 2023, Hinenburg had alleged Adicorp Enterprises, Milestone Tradelinks, and Rehvar Infrastructure were used as conduit entities to route funds from various Adani group companies to fund some of the conglomerate's listed firms. These allegations had led to the stock prices of Adani group companies to plummet. (Akash Mandal)

Equity Alert: Nomura says price cuts to hit Maruti Suzuki's margin by 100 bps

MUMBAI--1002 IST--Nomura Global Markets Research sees some impact on the margins of Maruti Suzuki due to efforts to revive demand in the entry-level segment, in which it has been losing market share due to shifting consumer preferences and low income growth. The company Thursday reduced prices of these cars to pass on the benefit of the goods and services tax cut. According to the brokering firm's calculation, the price cut due to lower GST rate should have been 6.5%, but the company has announced an average price reduction of 7.5% due to much higher price cuts in the entry segment cars, Brezza and Grand Vitara. 

Shares of Maruti Suzuki rose 1.5% Friday to an all-time high of INR 16,060. The stock is up for the fourth consecutive session and has risen more than 5% over this period. At 0955 IST, shares of the company traded at INR 15,856, up 0.3%.

Nomura expects the reduction in prices, higher than the GST cut, to have a 100-basis-point impact on Maruti Suzuki's margins in the near term. However, it has the potential to improve market share and operating leverage if consumer response is positive, Nomura said. Moreover, the company will also have to gauge losses in inventory due to higher price cuts.

"Moreover, all OEMs (original equipment manufacturer) may have to bear the impact of compensation cess on their dealer inventory if it is not refunded by the government. Wholesale volume management in September may prove to be challenging for most OEMs given the entire month's shipments will need to be executed from Sept. 22." Nomura believes a sustained recovery in entry-level car demand would depend on a broader macro recovery and income growth in the target customer segment. 

The key aspect to monitor will be whether lower upfront prices drive the lower-income population to buy entry-level cars. The brokerage believes the reason this section of the population has refrained from buying such cars is because wage growth has slowed over the past few years, even as the cost of cars and cost of living have increased sharply. Additionally, car ownership comes with other costs, such as fuel costs, parking, tolls, and maintenance, and the preference for sport utility vehicles was higher than entry-segment cars, which adds pressure on buying sentiment in this segment. 

For the Brezza, the price cut of 8% is more than the 3.5% GST benefit to maintain competitiveness against competing models such as the Hyundai Venue and MM 3X0, which got an 8.5% GST benefit, the brokerage said. "Our base case so far has been that the compact SUV segment holds the highest potential for share gain, as consumers may look to upgrade from hatchbacks to compact SUVs," Nomura said. The brokerage prefers Mahindra & Mahindra, Hyundai, Asok Leyland, and TVS Motor. 

Of the 25 brokerage reports on the stock available with Informist, 21 have a 'buy' or equivalent rating on the stock and four have a 'hold' or equivalent rating. So far Friday, 182,160 shares of the company have changed hands on the NSE, higher than 118,323 shares traded during the same period on Thursday.  (Simran Rede)

Equity Alert: Mkt opens down; Adani cos surge as SEBI dismisses allegations

MUMBAI--0949 IST--Benchmark indices opened lower with banks as the top laggards in the Nifty 50 index. Adani group companies surged at open as the Securities and Exchange Board of India dismissed allegations against group companies by Hindenburg Research.

HDFC Securities in a note Thursday had said that the Indian indices may open lower Friday "as investor sentiment has been dampened by the revocation of sanctions relief for India at Iran's Chabahar port." At 0938 IST, the Nifty 50 was down 0.4% at 25324.50 points and the Sensex fell 0.4% to 82652.71 points. 

Nestle India declined over 1% and was the worst performing stock in the Nifty 50. Tata Consultancy Services, Grasim Industries, and Hindalco Industries fell nearly 1%. Among the heavyweights in the 50-stock index, ICICI Bank and HDFC Bank fell 0.5-0.7%.  

Adani group companies were the top gainers. Shares of Adani Enterprises rose nearly 4% after the Securities and Exchange Board of India gave a clean chit to the company on the allegations of accounting manipulation by Hindenburg Research. All Adani companies gained with Adani Total Gas, Adani Power, and Adani Energy Solutions up 4-9%.

Among sectoral indices, Nifty IT was down nearly 1% and emerged as the top loser. Nifty Private Bank and Nifty Financial Services fell 0.4%. Nifty Energy and Nifty PSU Bank gained 0.6% and 0.5%, respectively. (P. Madhu Kumar)

Equity Alert: Citi ups target price of some automobile stocks by 17-33%

MUMBAI--0845 IST--Automobile stocks will be in focus after global brokerage Citi raised its target price for some auto makers. The brokerage has raised its target price for Hero MotoCorp and Eicher Motors by 17% and 25% to INR 6,100 and INR 7,850, respectively, maintaining a 'buy' rating on both. These new target prices imply a potential upside of around 14% from the current levels.

It has maintained a 'sell' rating on Bajaj Auto and TVS Motor Co. but raised target price by 8% and 33% to INR 7,900 and 2,800, respectively. The brokerage said the impact of multiple macroeconomic tailwinds will be higher for two-wheeler makers than for companies in the passenger vehicles segment. 

Morgan Stanley has maintained an 'overweight' rating on Maruti Suzuki India with a target price of INR 18,360, implying a potential upside of 16% from the current levels. The company is working to revive its first-time car buyers segment, which will be a growth driver, NDTV Profit reported the brokerage as saying. The financial impact will be neutral to positive when aggressive discounts are removed once volumes revive, it added.

Automobile stocks have been among the biggest gainers in the past few weeks when the benchmark indices have also posted robust gains. The Nifty Auto has gained 9.5% so far this month and is the top gainer among sectoral indices during the period after the Nifty India Defence. Mahindra & Mahindra, Eicher Motors, Ashok Leyland, and TVS Motor Co. have gained 8-14%.  (Akash Mandal)

Equity Alert: Most Asian indices rise; Bank of Japan rate decision eyed

MUMBAI--0809 IST--Most indices in Asia were higher in early trade Friday, tracking overnight gains in the US market. Japan's Nikkei 225 rose to fresh record intraday highs after the country's core inflation rate in August fell to its lowest level since November. Market participants await Bank of Japan's decision on interest rates, due later in the day.

Japan's Nikkei 225 Day index was 0.8% higher. Consumer price inflation for August in Japan rose 2.7% on year, in line with market estimates but higher than the country's central bank target of 2%. The reading showed a small increase from July. Market participants await the conclusion to Bank of Japan's two-day meeting where the central bank is expected to keep its short-term policy rate steady at 0.5%.

"We expect the BOJ to raise rates by early next year, but it is unclear whether officials will be able to make a decision this coming October," Reuters quoted Kei Fujimoto, senior economist at SuMi TRUST, as saying.

Japan's Topix gained 0.6% and the Chinese CSI 300 was up 0.4%. Meanwhile, South Korea's Kospi fell 0.4% and the FTSE Singapore Strait Times index was also lower.

Following were the levels of key Asian indices at 0805 IST:

(Eshitva Prakash)

Equity Alert: Indices likely to consolidate but sentiment remains strong

MUMBAI--0804 IST--Benchmark indices are likely to move in a narrow range with a positive bias as sentiment remains positive on hope of trade deals with the US and the European Union. Both indices are likely to rise more in the coming sessions, but gains are expected to be gradual. The 25500 level is the immediate hurdle for the Nifty 50, and the index may see more gains if it manages to cross this resistance, analysts said. The index is expected to find support at around 25200-25300 points.

"Derivatives positioning continues to reflect optimism, with put writers maintaining an edge over call writers," Dhupesh Dhameja, derivatives research analyst at SAMCO Securities, said in a note. "The put-call ratio eased marginally to 1.09 from 1.16, still reflecting a positive bias...short consolidation phases or shallow dips may act as accumulation windows," he added.

The September contract of the Nifty 50 indicates a flattish start for the market. At 0755 IST, the contract was at 25466.50 points, flat from its previous close. On Thursday, the Nifty 50 closed at 25423.60 points, up 93.35 points or 0.4%. The BSE Sensex ended at 83013.96 points, up 320.25 points or 0.4%. Both benchmark indices have seen short covering over the past few weeks, which has been driving gains in the market. Both the indices have gained 4% so far this month.

Overnight, indices in the US ended at record highs and continued their bull run. The Nasdaq Composite has gained nearly 5% so far this month, while the S&P 500 has gained nearly 3%. The Dow Jones Industrial Average has risen a little over a percent in the same period. Intel surged 23%, posting its biggest daily gain since October 1987, after Nvidia said it would invest $5 billion in the struggling US chipmaker, Reuters reported. Nvidia rose nearly 4%. Most Asian indices were higher in early trade Friday, tracking gains in the US market.  (Akash Mandal)

Equity Alert: US indices at record highs; Intel up 23% on Nvidia investment

MUMBAI--0745 IST--Indices in the US closed at record highs Thursday, a day after the US Federal Reserve cut its key interest rates by 25 basis point. Reports of a partnership between technology giants Nvidia and Intel pushed the Nasdaq Composite and the S&P 500 technology index higher.

The technology-heavy Nasdaq Composite closed nearly 1% higher. Shares of Intel jumped 23% after Nvidia announced it will invest $5 billion in the former, according to media reports. Shares of Nvidia also rose and gained 3.5% after it had closed lower in the previous session following a report that Chinese technology firms may stop buying chips from the company.

Initial claims for unemployment benefits in the US fell 33,000 during the week ended Saturday to a seasonally adjusted 231,000. This reading was lower than the 240,000 claims estimated by Reuters. Jobless claims had risen to 264,000 in the previous week.

Among stocks, shares of cybersecurity company CrowdStrike Holdings closed nearly 13% higher after nine brokerages raised their target price on the stock, according to a Reuters report. Meanwhile, shares of Darden Restaurants fell 7.7% after its parent company, Olive Garden, missed quarterly profit estimates.

Following are the closing levels of US indices Thursday:

(Eshitva Prakash)

US$1 = INR 88.30

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT]

End

Edited by Akul Nishant Akhoury

All prices from National Stock Exchange, unless otherwise specified.

All percentage changes for share prices are rounded off to the nearest whole number; percentage changes for index values are rounded off to one decimal place.

All times are Indian Standard Time.

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