The Indian equity markets have been on a downtrend since they entered 2025. The brokerage house Kotak Institutional Equities has given a ‘Sell’ call on three stocks at this hour.
Kotak Institutional Equities on IndusInd Bank: Cuts target price by 40%
India’s fifth biggest lender is in deep soup. The negative news is blowing apart its share price without a break. First, the RBI approved the CEO’s extension for only 1 year instead of 3. Then, the bank reported discrepancies in its derivatives portfolio, erasing gains of Q3 FY25. The stock slumped more than 27% in a single day. “As rebuilding the lost credibility is likely to take more than a few quarters,” said Kotak. The brokerage firm downgraded the stock to ‘Reduce’ from ‘Buy’, with a 40% slash in target price to Rs 850 from Rs 1,400 earlier.
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JSW Energy completed the acquisition of a 74% stake in KSK Mahanadi for an enterprise value of Rs 16,100 crore. However, the brokerage house thinks that it lowers the headroom for incremental debt. “We note that the acquisition helps JSW Energy raise its capacity targets to 28 GW by FY2030, although the incremental debt and the potential acquisition of O2 Power will likely limit its ability to pursue further acquisitions,” said Kotak. The brokerage house retained ‘Sell’ rating on the stock and marginally raised the target price to Rs 385 from Rs 370. The company’s “valuations have come off but still remain high at 2.9X P/B and 23X P/E (FY2026E), as the CMP is not fully factoring the risk from execution slip-ups.”
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The brokerage house Kotak Institutional Equities expects NMDC’s earnings to peak in FY25 and decline thereafter. The company will face issues due to declining iron ore prices on increasing market surplus for seaborne iron ore and increasing supply pressure in India with the ramp-up of merchant iron ore mines directly competing with NMDC’s Chhattisgarh mines. Plus, the home ground is not suitable enough, if Karnataka tax bill is implemented, it could sharply impact earnings.
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