2 Mid Cap Stocks That Have Good Potential To Generate Strong Returns

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Mid cap stocks tend to be more volatile than the large cap stocks and are considered slightly more risky when compared to large caps. Markets have recovered almost 5 per cent from recent lows and now one has to be careful in picking stocks. Here are few stocks that could be good picks from the medium term.

 2 Mid Cap Stocks That Have Good Potential To Generate Strong Returns
Bank of India: Quotes, News
BSE 120.00BSE Quote0 (0.00%)
NSE 120.00NSE Quote0 (0.00%)
Glenmark Pharmaceuticals: Quotes, News
BSE 942.00BSE Quote5.45 (0.58%)
NSE 942.60NSE Quote7.8 (0.83%)
Bank of India

Bank of India only recently hit a new 52-week low. There are a few things that could work for the stock going forward. One is the fact that as we write there are reports that the Finance Ministry would consider fresh capital infusion in some public sector banks. This was the need of the hour as there was a desperate need to recapitalize public sector banks.

In all probability the non performing assets of some banks like Bank of India may have peaked. This means even if we see marginal improvement in the non performing assets of these banks in the coming quarters, the shares could flare given the fact that they have been hammered down.

The monsoon being above average is also good news for banks, which would not see bad loans rising due to rural distress.

In case there is a rebound in the economy expect banks like Bank of India to do extremely well. Shares of government owned banks are almost available at throwaway prices, making them attractive value picks.

Glenmark Pharmaceuticals

Glenmark has been growing rapidly especially with sales from the US markets expected to grow at a whopping rate of 33 per cent. Recently, Prabhudas Lilladher recommended the stock in its research report. The firm set a target price of Rs 1,186 on the stock.

The company is among the few pharma companies that so far has had no major problems with regards to the US FDA.

Glenmark Pharmaceuticals recently received US FDA approval for the extended-cycle oralcontraceptive, Levonorgestrel/Ethinyl Estradiol Tablets.

The company is expected to continue to clock a strong growth in the coming years with an expected EPS of around Rs 30 for 2016-17. Though the stock may look a little expensive at the current levels, one could buy on dips for the long term.

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