Deutsche Bank starts coverage on MRF Ltd and Ceat Ltd with "buy" rating and PT of 80,000 rupees and 2,150 rupees respectively, citing revival in volume growth and margins.
India truck tyre demand should recover to 8 pct p.a. in FY17-20 vs. 1 pct p.a. in FY14-17 - Deutsche Bank analysts.
Brokerage sees EBITDA margins in sector improving by 600 - 1,100 bps from current depressed levels, driven by lower raw material prices, favourable anti-dumping duty on Chinese tyres.
Brokerage maintains its "buy" recommendation on Apollo Tyres Ltd, but raises PT by 18 pct to 325 rupees.
Apollo, on which 17 out of 21 brokerages have a "buy" or higher rating, was up 2 pct in a weak market which was more than 1 pct down.
MRF, one of India's most expensive stocks, rose as much as 1 pct to 64,000 rupees. The stock is up about 45 pct in one year.
Ceat gained 1.8 pct at 1,773.8 rupees, snapping 3 straight sessions of losses.
