7 stocks that brokerages are betting on for super returns

Updated: Saturday, July 19, 2014, 10:21 [IST]

Markets have recovered once again this week, though the Sensex is still some way from scaling fresh peaks. Here are 7 stocks that brokerages are betting on from a medium to long term perspective.

Riding high after Q1 results

Broking firm Emkay Global has put a accumulate call on TCS. The firm has said that the company's consistent execution engines keeps rolling with growth in the US comforting.

"Raise FY15/16E EPS by 2/4% to Rs 110/125. While TCS's valuations remain a little punchy, they are fair given the well oiled execution. Retain accumulate with a target price of Rs 2,600 on higher 1yr forward P/E multiple based on greater growth comfort," the firm has said in its research report.

Kotak Securities puts accumulate

Kotak Securities has put an accumulate rating on CYIENT.

"We believe CYIENT has to bring in more consistency in revenue growth for sustained valuation gains. CYIENT had reported a 6% revenue growth in FY13 and 5% growth in USD revenues in FY14. Expected cash/cash equivalents of Rs.66 per share by FY15 end, may provide cushion to the stock," says Kotak Securities research report.

Buy rating from Motilal Oswal

Motilal Oswal has a buy rating on Bajaj Auto with a price target of Rs 2,333. "Demand recovery along with stability in competitive intensity would be the key driver for stock's performance. Bajaj Auto trades at 16.8x/14.3x FY15E/FY16E EPS respectively. Maintain Buy with a target price of INR2,333 (16x FY16E EPS)," says Motilal Oswal research report.

Price target of Rs 435

ICICI Direct has a price target of Rs 435 on Bajaj Electricals in the next 12 months. "An expected recovery in margin in E&P and sustained margins in consumer durable & lighting would help drive BEL's bottomline, going forward. We believe the bottomline of the company would grow to Rs 186 crore in FY15E and Rs 313 crore in FY16E," the firm has said in its research report.

Religare sets price target of Rs 240

Religare has set a target of Rs 240 on the Crompton Greaves stock.

"In our view the proposed de-merger of the consumer business of CRG into a separate listed entity is likely to unlock value as requirements of the B2C business get addressed more optimally over time. We marginally raise our FY17 estimates for the consumer business, while maintaining numbers for the power and industrial segments. Our Sep'15 TP thus rises to Rs 240 (from Rs 235), " the firm has stated in its research report.

Emkay Global puts a buy call

Emkay Global has put a buy call on Federal Bank.

"The bank has put up a strong show for Q1FY15 with improving NIMs (10bp qoq adjusted) and significantly lower credit costs. Moreover we draw comfort from the fact that: 1) Standard restructured book ex-Air India and SEB is at Rs11bn (2.6% of advances) and hence reducing the possibility of any significant provision shock from this book, 2) SME/Retail ex gold witnessing healthy growth with stabilizing asset quality, 3) Improvement in the deposit profile," the firm has said in its research report.

Price target of Rs 718

IIFL has set a target of Rs 718 on the stock of Bharat Forge. "Since the month of May, the stock is moving along with the support of its rising trendline which coincides with its 20-DMA. Every decline towards this critical moving average is met with buying interest. In yesterday's session, the stock surpassed its previous peak of Rs 682 made a new lifetime high. We expect the momentum to continue in this counter. (Duration 4 days)," says IIFL research report.