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2 Stocks To Buy Next Week As Listed By Sharekhan
Broking firm Sharkhan is betting on the stocks of IndusInd Bank and Shoppers Stop for good returns. With the markets having fallen almost 10% from historic highs, these stocks offer good opportunities to buy.
Buy IndusInd Bank, says Sharekhan
According to Sharekhan, IndusInd Bank released the findings of external auditors on an independent review pertaining to microfinance advances by its subsidiary, Bharat Financial Inclusion Ltd.
"The review found that a technical glitch led to the disbursement of loans without client consent as a result of IT change management and process gap. The findings of the review are as per the management's expectations. The impact of the lapses and the quantum of exposure is not material, thus ending a major overhang. We believe, that with the findings of the audit, worries relating to the ever-greening of loans in its subsidiary are unfounded and the bank is likely to witness a turnaround in earnings," the brokerage has said.
"The stock price has corrected by 30% from highs of Rs. 1,242 and is trading at a discount to its historical valuations as well as to its peers. The stock currently trades at 1.3x/ 1.2x its FY23E and FY24E book value, which is reasonable. We expect the bank's valuation to expand from the current levels. Hence, we maintain a Buy with a revised price target of Rs. 1,150," the brokerage has noted.
Shoppers Stop: Buy with a 34% upside
Sharekhan reiterates its positive stance on Shoppers Stop Limited with a potential upside of 34% over the next 12 months.
"Strong prospects and attractive valuation at 7.0x/5.3x its FY2023/ FY2024E EV/EBIDTA make it a good pick in the retail space. Shoppers Stop will be one of the key beneficiaries of strong improvement in demand (led by improved footfalls/revenge buying), shift from unorganised to organised retail, and increased traction on omni channel, which will help it to drive growth ahead of the retail industry's growth.," the brokerage has said.
"The company targets revenue to double from FY2020 levels over the next 4-5 years, led by key strategic pillars - 1) increasing members of First Citizen customers; 2) scale up in contribution of private brands; 3) strong growth in revenue of beauty products; and 4) higher sales through the omni-channel platform. The four strategic pillars will be supported by store addition of 12-15 department stores per annum and improvement in the omni channel platform to improve customer traction. Capex for store addition will be done through internal accruals," Sharekhan has said.
Disclaimer
The stock has been picked from the brokerage report of Sharekhan. 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.
