MUMBAI: Bank of America- Merrill Lynch (BofA) recommends a buy on BHEL and Reliance Capital.

Here are the views in detail:

On BHEL
Buy with a price target of Rs 2750
Remains top pick on improving visibility of 23% EPS CAGR over FY09-12E
Focus on private IPPs to retain market share
Signed a 10-year wage agreement, which will cut its labour costs by 250 bps in 2 years

On HUL

Rating underperform, with a price objective of Rs 240
Price cuts, higher A&P spends could affect profitability in the near term
Price cut to create value in the medium and long term
Rising food inflation is a threat to growth witnessed by FMCG sector
Expect near term pain to continue, maintain underperform
Will continue to face pressure both at the top line and margin levels
Margins will be hit from rising input-cost scenario
Current valuations are not justified in a scenario where risks are rising

On Rel Cap
Buy with a price target of Rs 1015
Cost-saving initiatives should enhance profitability of life insurance business
Margin in insurance business likely to come down
Expects home finance, asset finance business to yield 16-18% RoEs over medium term

On Unitech
Neutral rating, with a price objective of Rs 90
Has been delivering an impressive performance since April 2009 on residential sales volumes
Price triggers seem at least six months away
Absence of immediate triggers and upgrade drivers believe now perfectly priced

HSBC on telecom
Remain cautious on sector, given the prevailing price competition
No overweight ratings in the Indian telecom space