MITUL SHAH
Premium play will help out Hero MotoCorp on revenue and margins: Mitul Shah
We believe that going forward this premium play will help out the company on the revenues and margin front and on the other hand whenever in past we have seen that rural economy started improving it has really given a strong mileage to Hero Moto being more than 50% volumes coming from rural India.
IT sector performance to improve, but pace of growth to be much slower: Mitul Shah
So part of that got recovered after this Accenture result which was a slightly positive surprise in terms of the revenue as well as margin. Also order book was also reasonably strong for Accenture that led to regaining some confidence in investors for the IT space which helped outperforming IT index.
Mitul Shah on Wipro Q3 results & 2 top IT picks
“Our top pick would remain Infosys which we have been bullish on since the last two-three quarters. Within the IT pack, we like Infosys only and last quarter we upgraded HCL Tech from hold to buy. The second bet would be HCL Tech. We have a buy on Wipro but after this commentary, we would able to come out with details in terms of whether we will maintain the positive stance”
Infosys and HCL Tech remain our top picks in IT sector: Mitul Shah
Last two-three quarters we moderated and downgraded the sector but Infosys and HCL Tech remained our top picks.
Tata Motors moving in right direction in terms of profitability and cash flow: Mitul Shah
So this also indicates that directionally now company has started moving into the right direction in terms of the profitability and cash flow apart from volume uptick as for volume there is order book pending of more than 2,15,000.
Revenue growth a positive but at 25X, TCS valuation slightly expensive: Mitul Shah
“On Tuesday we may see a range-bound reaction based on the mixed result, but post that and definitely in the next two-three days, other IT giants are also reporting their numbers and based on that, overall sector movement will be decided after these two-three key results comes out along with management commentary.”
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Margins will go back to double digit territory for tyre companies: Mitul Shah
In terms of demand side, there is a strong order book for OEM PV but semiconductor issue is restricting the production. But still demand remains reasonably strong on that side.
Tata Technology can get 5% to 6% of current market cap of additional value :Mitul Shah
Certainly we believe that Tata Technology can easily get around 5% to 6% of the current market cap of additional value.
4 stocks to go for in auto and auto ancillary space: Mitul Shah
“Within the auto segment, a positive surprise is coming on the tractor side, though this segment has also witnessed a month-on-month decline post the festival impact. But compared to the numbers which the Street is expecting for the tractor industry on a YoY basis, the industry is coming flat or showing a marginal growth against Street expectation of 5-10% decline.”
Is M&M’s strong Q2 performance sustainable? Mitul Shah explains
“In the tractor segment, EBIT margin has improved by 40 bps sequentially. It came close to 17% EBIT margin whereas on the other end, auto segment EBIT margin has also improved by 45 basis point to 6.1%. These two are not in line with the trend which we have seen for other companies and this is a positive surprise. ”
ETMarkets Smart Talk: Planning to invest Rs 10 lakh in markets? Allocate 45% to debt & 30% towards equities: Mitul Shah
In an interview with ETMarkets, Shah, with over 17 years of experience, said: “The underlying strength of Indian equities remains intact on account of visible CAPEX recovery, improving prospects of the asset quality of banks and various reforms undertaken by the government that started supporting economic momentum." Edited excerpts:
Why is Mitul Shah betting on these 2 stocks in the auto space?
“In the two-wheeler space overall, we have a buy recommendation because of attractive valuation but we believe that it would take some more time to give sizable return to investors. We prefer Maruti Suzuki over others and we like a few ancillary companies like Bharat Forge wherein traction is coming from domestic CV side as well as non auto space.”
Earnings and valuation upgrade likely for Infosys: Mitul Shah
“The numbers will warrant the upgrade as the guidance has increased and margins for the second quarter came as a bit of surprise. Even if the company is maintaining margin guidance, there is a high probability that going forward in the second half as this wage hike will stabilise and pricing power coming back to this company margin would give positive surprise.”
HCL Tech could see upgrade tomorrow: Mitul Shah
“Geography wise, growth is coming in from the Europe side compared to America, Europe growth is higher than growth from America whereas everyone is feeling that Europe and UK is slowing down but this is not visible in HCL’s numbers. Even within verticals, manufacturing growth is coming at 10% quarter-on-quarter which is really commendable because overall there is a slowdown in manufacturing.”
After Tiago launch, Tata Motors to remain leader & emerge stronger in EV section: Mitul Shah
“Now a product on an EV platform is available at below Rs 10 lakh ticket size. That definitely is very strong in terms of a response from the consumers. But more importantly, this is coming on a platform or from Tata Motors, a brand which is already successful on the Indian markets and so people will definitely accept this.”
Wipro net falls 21%, revenue up 18%
"Wipro's revenue was broadly in line with our expectations while margins were below our expectations. Recent restructuring efforts, which include simplified operating structure, step-up in capability upgrade and talent management under new leadership, bode well for Wipro in the medium-term," wrote Mitul Shah, head of research at Reliance Securities.
Rising wages, costs wipe gains for IT
The rupee depreciating would ordinarily have been a big positive for the Indian IT industry and goods exporters, helping improve margins and competitiveness.But this time, other developments have partially offset the advantage.
What M&M’s new EV arm with Rs 70,000-cr valuation mean for Indian auto sector? Mitul Shah explains
“The valuation of Rs 70,000 crore for M&M’s EV business is on the higher side but even if we take on the lower side because there are number of terms and condition and milestone for future investment by all these partners which are based on certain achievement on the EV side, on the lower side, it can be around Rs 40,000 crore.”
Maruti, M&M to gain shares from TaMo, Hyundai in compact SUV: Mitul Shah
“Sentiment is very strong in the passenger vehicle segment though in the case of two-wheelers, there is some issue because of the consumer segment for that category of vehicle is a little price sensitive in terms of vehicle prices as well as operational costs as fuel prices are also at close to record high.”
Mitul Shah on what Bajaj Auto share buyback means for co and investors
“After dividend payout, there will be Rs 16,500 in cash and cash equivalent at the end of June with the company. Annual capex is not very high at Rs 500-600 crore and Rs 10,000-12,000 crore cash in the balance sheet is more than sufficient. All this calculation leads to roughly Rs 3,000-5,000 crore in buyback value and the price is right now at around Rs 3,900. So buyback would be somewhere in the range of Rs 4,000-4,500.”
Sanctions on Russian products would have high negative bearings on global and Indian equities: Mitul Shah
IMF has cut its FY23 growth forecast for India by 80bps to 8.2 per cent, warning that Russia's invasion of Ukraine would hurt consumption and hence growth, by way of higher prices.
ETMarkets Smart Talk: Book profits in high beta and midcap stocks; Nifty may hit fresh highs in 2022: Mitul Shah, Reliance Securities
"We expect the Russia-Ukraine issue to settle down in the next 1-2 months and FPI flow would return to Indian equities soon, taking markets to a new high in 2022. We also expect that SIP trend would remain strong as the return from most other asset classes is much lower than equity and equity MFs."
Are auto companies facing margin pressure? Mitul Shah answers
“There is demand for the high end products particularly high end XUVs while entry level cars and two-wheelers are facing challenges.”
Harley-Hero pact a win-win deal for both
Hero MotoCorp will get Harley’s distribution network and will have a license to sell this product through their existing dealerships, says Mitul Shah
After better than expected performance in Q2, will Tata Motors do better in Q3?
Tata Motors has outperformed both in terms of top line as well as margins, says Mitul Shah.
Bajaj Auto’s strong cash position a big positive
Bajaj Auto’s sequential as well as the year on year EBITDA margin improvement is definitely commendable, says Mitul Shah.
For PVs, two-wheelers and tractors, recovery is better than expectation: Mitul Shah
People were expecting a marginal drop till the first half, whereas industry has already started growing.
BS-VI may actually put Maruti in a fast lane: Mitul Shah
As 70-80% of Maruti portfolio BS-VI compliant, it will be comparatively protected
A tech tieup could help Tatas to cut costs: Mitul Shah, Reliance Securities
In next two-three quarters, any major turnaround may not be possible, says Shah
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