5 Great Stock Ideas For The Long Term

Repco Home Finance

Centrum Broking is bullish on the stock of Repco Home Finance and has placed a buy on the stock. "During our last update post demonetization (29 Nov'16) we had given a Buy rating on the stock at a price of Rs 600, considering its future growth prospects and attractive valuation (3.1x the then FY18 ABV estimate). Considering, strong growth recovery (management guidance of +30% loan growth) from FY18 onwards along with healthy financials, we remain positive on RHFL from a long term perspective. Maintain our Buy recommendation with a target price of Rs 754, valuing the stock at 3.5x its Sept'18 book value," the firm has said in its research report. This should be a good long term stock idea. Check stock quote of Repco Home Finance here

Bank of Baroda

Geojit has placed a buy call on the stock price of Bank of Bank of Baroda, with a price target of Rs 195. The firm sees returns on assets (RoA) and Return on Equity (RoE) improving.

"We expect the RoA and RoE to improve to 0.5 per cent and 8 per cent, respectively by FY19E. Hence, we continue to maintain BUY rating with a revised upwards target price of Rs 195 (as we rollover our number to FY19E) and value the bank at P/ABV of 1.3x for FY19E, " the firm has said in its recent research report. The shares of the bank had fallen a great deal recently following a poor set of numbers, but, have rallied since. The shares of Bank of Baroda last closed at Rs 168 on the National Stock Exchange.

Check stock quote of Bank of Baroda here

State Bank of India

Geojit is also bullish on the stock of State Bank of India. "Deposits showed healthy growth of 14 per cent, year of year, boosted by demonetization. Domestic deposits grew by 24 per cent, driven by 35 per cent increase in current and savings account deposits. Hence, the CASA ratio improved sharply by 385 bps YoY to 46.6%. However, SBI's loan growth was subdued due to 11% YoY decline in SME loans and muted growth in large corporate loan book. "We continue to maintain a BUY rating on the stock with a revised upward target price (TP) of Rs 315 using the sum of the part (SOTP) methodology, where we value its standalone business at Rs 251 (P/ABV of 1.4x for FY19E) and subsidiaries at Rs 64," the firm has said in its report.

Check stock of State Bank of India here

Equitas Holdings

HDFC Securities has placed a buy call on the shares of Equitas Holdings with a price target of Rs 210. The firm sees potential for the company following the conversion to a small finance bank. The firm also noted that Equitas's lending practice is supported by strong risk management practices. Its outstanding credit

per borrower in the micro finance book is the lowest among peers.

"The small finance bank conversion would make Equitas' growth sustainable (and arguably superior to vanilla micro-finance) with cost and franchise benefits. Initiate coverage with a BUY and a target price of Rs 210 (3x Dec-18 P/ABV)," the firm has said in its research report.

Check stock quote of Equitas Holdings

Coal India

HDFC Securities also has a buy rating on the stock of Coal India. Of the two legs of our bullish hypothesis on COAL, higher pricing of alternatives has begun playing out, as both petcoke (2x from bottom November 2015) and imported coal (up 60% from bottom, May 2016) pricing has improved.

"We expect this to improve once overall economic growth, which has been sluggish, takes off. With its built-in operational leverage, COAL's numbers can largely outperform expectations. We maintain BUY with a target price of Rs 369," the firm has said in its research report.

Disclaimer

The article is not a solicitation to buy, sell in securities or other financial instruments. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and the author do not accept culpability for losses and/or damages arising based on information in this article. The author and his family do not own any shares in the above mentioned stocks.