11 Preferred Large Cap Stock Ideas That Have Corrected Sharply From 52-Week High: Motilal Oswal

Motilal Oswal -the leading brokerage firm in its 'The Eagle Eye' report for May 2022 has stated that the global markets during April witnessed a decline on account of global economic growth and inflationary concerns. Nevertheless during the same time period, 56% of the Nifty index constituents gained.

Sectorally, oil & gas, consumer and auto pack outperformed, while technology pack came out as laggard during the April month.

As per the report:

- Oil and gas sector's weight increased 180 bps since December 2021 at 14.1%

-Technology sector's weight declined 300 bps to 16.1% in April 2022

Further individually, Nifty stocks including NTPC, M&M, Adani Ports, Hero Motocorp and HUL led the list of gainers, while laggards have been Infosys, Tech Mahindra, Hindalco, Wipro and Bajaj Finserv.

View on Q4Fy22 Earnings as given out by Motilal Oswal- Earnings in line so far, EBITDA margin has been impacted

"For the MOFSL Universe (65 companies), sales/EBITDA/PBT/PAT growth stands at 19%/14%/26%/30% YoY (v/s our expectation of 18%/15%/23%/22% YoY), respectively", says the brokerage.

Nifty Valuations

As per the brokerage, the Nifty 12-month forward P/E at 19.4x is at a premium of 6% v/s its LTA of 18.4x. At 3.0x, the 12-month forward P/B stands at a 15% premium to the Nifty's historical average of 2.7x.

12-month trailing P/E for the Nifty on the other hand stands at around 22.9x, 15% more than its LTA.

Top 11 Preferred Large Cap Stocks as per the brokerage

Company	CMP (INR)	Corr. From 52W(%)
Preferred large cap stocks
Reliance Inds.	2,643	-7
Infosys	1,586	-19
ICICI Bank	727.2	-16
Bharti Airtel	722.35	-7.6
State Bank	480	-12.5
HCL Technologies	1072.5	-22
Titan Company	2,260	-18
Ultratech Cement	6,352	-23
Hindalco	461.45	-27
Apollo Hospitals	3941.9	-33.58
Bank of Baroda	105.6	-14