PICK OF THE WEEK (February 14)

ABB India – Reduce Recommendation by HDFC Securities Most of the potential upsides on cyclical recovery is already priced into the lofty valuation. Hence, we maintain REDUCE on ABB and roll forward our valuation to Mar-23E. We revise our TP to Rs 1,426/sh vs. Rs 1,268/sh earlier. We have retained our estimates.
Britannia Industries – Reduce Britannia reported a mixed result as the company clocked a miss on revenue but a marginal beat in margins. Rising debt, inter group transactions and modest FY22 earnings growth will keep valuations in check. We value Britannia at 40x P/E on Mar-23 EPS to derive a TP of Rs 3,589. Maintain Reduce Indostar Capital Finance – Reduce Despite a reasonable asset quality performance with pro forma GNPAs at 2.8 per cent (vs. 2.9 per cent in 2Q), we are cautious in our outlook given the sizeable pool of GS-II (20 per cent of loans), underpinning our Reduce rating (revised target price of Rs 309).