TSX gains on big banks strength
Investing.com - Nomura/Instinet downgraded Bharat Electronics (NSE:BAJE) Ltd (BHE:IN) from Buy to Neutral while raising its price target to INR400.00 from INR363.00.
The downgrade follows a 51% rally in the stock price over the past six months, significantly outperforming the NIFTY’s 7.5% gain during the same period, according to Nomura/Instinet.
The research firm cut its FY26F/FY27F sales estimates by 1%/4% to reflect slower than anticipated execution rates, while projecting that gross margins could sustain at 47-48% in FY26F before contracting by 80-100 basis points during FY26-FY28.
Nomura/Instinet forecasts a profit after tax (PAT) compound annual growth rate of 13% over FY25-28F, substantially lower than the 31% CAGR achieved during FY22-FY25, with PAT estimates 1%/4%/5% below consensus for FY26/FY27/FY28.
The stock currently trades at 48.4x/42.4x FY26F/27F earnings per share, compared to its average one-year forward price-to-earnings ratio of 30x during FY22-FY25, with Nomura/Instinet noting the current valuation has "priced it to perfection."
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.