Buy These 2 Stocks For Upto 18.3% Returns In 1 Year

Britannia Industries

Britannia Industries has been picked by Emkay Global, and the brokerage firm has recommended investors to buy this stock for getting 11.8% returns in 1 year. In a recent report, the firm has mentioned that the target price for the stock should be Rs. 4,050, as the Current Market Price is ~ Rs. 3,622, the stock is expected to give good returns.

Britannia reports in-line sales growth of 6% (2-year CAGR of 9%), with volumes growing by ~2%, and their market share gains were stronger than FY21. However, their EBITDA declined 17% to Rs. 5.6bn, and PAT dropped 23% on high comparables.

 

Emkay Global's take on Britannia's stock

According to Emkay Global, "Britannia Industries Refer to important disclosures at the end of this report Steady growth trends; margins to recover sequentially. The growth outlook seems to be improving, with margins likely to recover QoQ. Increased aggression in non-biscuit portfolio amid the pick-up in on-the-go consumption."

The firms added, we "Retain 'Buy' but reduce Target Price (Dec'22) to Rs. 4,050 from Rs. 4,300 (45x Dec'23E EPS). We believe that PLI benefits could add more upsides."

Mahindra & Mahindra's stock has been picked by brokerage firm Emkay Global to 'buy', anticipating an 18.3% return in the upcoming 1 year. In the latest report, the firm has mentioned that the target price for the stock should be Rs. 1,055, as the Current Market Price is ~ Rs. 892, the stock is expected to give good returns.

In the Q2FY22 Mahindra & Mahindra reports that their EBITDA declined 19% YoY to Rs. 16.6bn, which was marginally above Emkay's estimates. The company's revenue increased 15% to Rs. 133.1bn, above the firm's estimate of Rs. 124.6bn, mainly aided by better realizations in the Auto segment. Mahindra & Mahindra's adjusted earnings increased 29% to Rs. 16.9bn, 13% above the firm's estimates, owing to higher other income. Their PV order book is strong at 160,000+ units, led by robust demand for XUV700 and Thar models.

According to Emkay Global, "Refer to important disclosures at the end of this report Earnings above estimates; Auto segment to drive growth ahead. We expect revenue/earnings CAGRs of 12%/14% over FY22-24E. Auto revenue should

see a strong 18% CAGR, while Farm equipment revenues are likely to witness a subdued 2% CAGR."

The firm added, we "Recommend Buy with a Target Price of Rs. 1,055 (Rs. 920 earlier), based on 14x core P/E on Dec'23E (Sep'23E earlier) and the value of investments at Rs. 537/share (Rs. 435 earlier)."

Disclaimer

The above stocks have been picked from the brokerage report of Emkay Global. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.