Brokerage Updates – August 29, 2025

Jefferies – Greed & Fear

US Tariffs: India faces a $55–60 bn direct hit due to new US tariffs.

Sectors most impacted: Textiles, footwear, jewellery & gems — all highly employment-intensive.

Geopolitical angle: Conversations in New Delhi suggest tariffs stem from President Trump’s exclusion from mediating India–Pakistan ties. India continues to reject third-party intervention — a firm “red line.”

Agriculture: No Indian govt will open agriculture imports due to risks for poor farmers.

Policy outlook:

More fiscal easing likely.

RBI has turned dovish under new Governor Sanjay Malhotra (since Dec 2024).

SMEs: 50% tariffs a major headwind, pressuring microfinance & consumer finance.

View: Despite challenges, India remains the most dynamic market outside the US.

Portfolio change: Add M&M; Remove Aditya Birla Real Estate.

Jefferies – Telecom Sector

Q1 revenue growth: +16% YoY.

Market share: Jio & Bharti +20 bps vs FY25.

Drivers: Bharti’s superior subscriber mix → stronger revenue growth.

Vodafone: Slowing subscriber decline may enable tariff-led gains.

Outlook: Sector revenue CAGR of 14% to $46B over FY26–28.

Top pick: Bharti Airtel.

Jefferies – NBFCs

Loan demand remains subdued.

GST rationalisation could lift demand for small truck operators.

Price deflation: Negative for disbursements/LTV.

Stress rising across MSME due to slowing macro.

Tariffs may worsen stress in select pockets.

H2 outlook: Pickup in activity + lower rates to ease pressure.

Margins: NIMs likely to expand and cushion earnings.

Defensive pick: Muthoot Finance.

UBS – Financials

Upgrade Kotak Mahindra Bank to Buy — exposure to fast-growing segments.

NBFC preference: Chola, PFC.

Insurance pick: SBI Life.

Profit pool outlook: Sector profits to nearly double in 5 years.

Non-lending businesses (AMC, wealth mgmt) to grow 1.4–1.7x faster than lending.

Household savings shift to boost financial sector.

Raise Paytm TP to ₹1,250.

BofA – IT Services

India IT Services Indicator stable after 9 months of declines.

Supported by macro factors: Global Services PMI, Global ERR, US business apps.

Offsets weak industry-specific readings.

CLSA – IT Sector (Nvidia Read-Through)

Nvidia Q2 beat; Q3 guidance implies +54% YoY growth.

Positive on Indian IT due to:

Stronger US economy into 2026 (elections support).

Tariff base effect + potential Fed cuts → revival in discretionary spend.

Attractive current valuations = downside cushion.

Picks: Infosys, Wipro remain preferred.

TCS & Nvidia: Joint work on AI-native telecom solutions.

TCS clients to gain agentic AI & digital twin tech.

Infosys & Wipro also building Nvidia-linked capabilities.

Kotak – Clean Science

Rating: Upgrade to Buy (from Reduce).

TP: ₹1,370 (vs ₹1,380 earlier).

Stock corrected 20% post promoter stake sale (24%), now priced in.

Strong growth pipeline; risk-reward attractive.

Valuation: 30x Sept 2027E P/E.

Nuvama – Aditya Vision (AVL)

TP: ₹580 (raised from ₹503), Buy maintained.

Q1FY26 weak due to excess AC inventory (halted new orders after Apr).

OEM support: Free installation + doubled demo incentives + WC extension.

GST cuts likely to boost demand next season.

Expansion into Central UP underway; store throughput to normalize by FY27.

Forecast upgrades: FY27E Rev/EBITDA/PAT +4%/5%/5%; FY28E +8%/10%/11%.

Valuation rolled to H1FY28E → revised TP ₹580.

UBS – TVS Motor

TP: ₹3,475, Buy.

New Orbiter e2W launch strengthens EV leadership.

Targeting youth with competitive pricing & features.

Competition heating up in e2W, but TVS remains well-positioned.

UBS – Paytm

Rating: Neutral.

TP: ₹1,250 (raised from ₹1,100).

Next growth phase hinges on revenue scale-up.

Payment biz margins to improve FY25–27E.

Costs may inch higher.

Trades in line with internet peers (earlier at discount).

MOSL – Dr. Agarwal’s Healthcare

TP: ₹530, Buy maintained.

Merger: Dr. Agarwal Eye Hospital (AEHL) + Dr. Agarwal Healthcare (AHCL).

Completion in 12–24 months (approvals pending).

Minority interest (28% stake in AEHL) to be eliminated.

EPS accretion of 5–7% by FY27 expected.

Investec – Indigo

Rating: Sell maintained.

TP: ₹4,050 (29% downside from CMP).

Valuations already bake in aggressive growth till FY30.

Earnings momentum weakening; any additional supply could pressure stock.