Morgan Stanley has initiated coverage of French drinks companies Pernod Ricard and Remy Cointreau, according to local reports.

Les Echos said yesterday (25 May) that the broker has launched coverage of the two drinks groups at 'underweight'.

Pernod has a share price target of EUR42, with Morgan Stanley forecasting a reversal of recent strong growth in the mid-term. Remy Cointreau. Meanwhile, has a share price target of EUR22. Weak demand in the sector will hamper Remy's short-term profitability, Les Echos reported the broker as saying.

Pernod's shares were trading at EUR45.03 at close of trade today, with Remy Cointreau's shares trading at EUR25.43.