MARKET EYE-BoFA downgrades Hero MotoCorp; cuts target to 1,650 rupees

Tue Dec 4, 2012 10:08am IST

Related Topics

Stocks

   

* Bank of America Merrill Lynch downgrades Hero MotoCorp
 to "underperform" from "buy" and cuts its target price
to 1,650 rupees from 1,980 rupees.
* The bank expects the company's domestic sales to remain muted
and in 'single digits.' This is primarily due to heavy
dependence on 100cc bikes where better options are available
with competitors, and likely structural shift to 150cc plus
premium bikes where the "company's franchise is weak".
* "We cut our export assumptions by 40 percent/year to factor in
the six-month delay in its overseas foray," BofA said in a note.
* It expects Hero MotoCorp's margin expansion to be muted, cuts
EBITDA margin assumptions by 70bp/year to 11.4/13.1 percent to
factor peer pressures, and rupee weakness that will hurt
imports.
* At 0436 GMT, shares were down 0.72 percent at 1,808.05 rupees.

 (manoj.dharra@thomsonreuters.com)
FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

School Shooting

School Shooting

Two killed, four wounded in Washington state school shooting.  Full Article 

Sundar Pichai Elevated

Sundar Pichai Elevated

Google's Pichai to oversee major products and services.  Full Article 

Need For Reforms

Need For Reforms

Euro zone risks "relapse into recession" without structural reforms - Draghi.  Full Article 

Diwali Sales

Diwali Sales

Gold sales jump about 20 pct for Diwali - trade body  Full Article 

World Bank Rival

World Bank Rival

Three major nations absent as China launches W.Bank rival in Asia  Full Article 

Wal-Mart India

Wal-Mart India

Murali Lanka appointed as Wal-Mart India operations chief  Full Article 

Health Of Lenders

Health Of Lenders

25 European banks set to fail health checks - sources.  Full Article 

Special Report

Special Report

Why Madrid's poor fear Goldman Sachs and Blackstone  Full Article 

India Insight

India Insight

Kalki Koechlin on her role as a disabled girl in “Margarita, With a Straw”  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage