DUBAI (Reuters) - JPMorgan JPM.N is the first major brokerage to initiate coverage of Saudi Aramco 2222.SE with an "overweight", setting a price target of 37 riyals ($9.86) per share and saying it sees scope for an increase in the energy giant's proposed $75 billion base dividend.

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Goldman Sachs on Tuesday rated the company “neutral” with a price target of 41 riyals while HSBC on Wednesday initiated coverage of Aramco with a “hold” rating and a target of 36.80 riyals.

Bank of America Merrill Lynch said it rates Aramco as “neutral”, with a price target of 36 riyals per share.

“Aramco is unique. In terms of quality of assets, scale and profitability it dwarfs just about any company globally,” BofA said in a note. “Yet, at current valuations, most of the outstanding fundamental factors are already priced in.”

Citigroup also gave Aramco neutral rating with a price target of 34.1 riyals.

Bernstein and Jefferies both initiated coverage of Aramco last month with “underperform” ratings saying the company had been priced at a premium to international oil majors in its December IPO despite governance issues.

“Our bullish view is predicated on its dividend growth outlook, with scope to increase the $75 billion baseline as production scales up,” JPMorgan said in a note.

Morgan Stanley had an “underweight” rating and a price target of 28.10 riyals, the lowest among investment banks that advised Aramco on its IPO.

JPMorgan said Aramco’s ability to sell its oil at a premium, capital expenditure flexibility and low debt to equity ratio would allow it to distribute a higher percentage of cashflow.

The brokerage said Aramco is uniquely positioned to raise production with minimal incremental capital expenditure.

It said it could see Saudi production capacity rising to 15 million bpd from the current 12 million and production of 10 million citing increased appetite by the kingdom to regain its share of global oil demand growth as oil markets tighten.

At 1134 GMT, Aramco shares were down 0.6% at 34.65 riyals. They were priced at 32 riyals for their IPO.

JPMorgan was one of nine global coordinators on Aramco’s IPO, which raised a record of $29.4 billion including a greenshoe allocation of extra shares.