Brokerage houses Axis Securities and Ashika Stock Broking have recommended buying the stocks of DCB Bank and Whirlpool of India in their recent research reports for good gains.
Buy DCB Bank for a target price of Rs 115
Axis Securities has set a price target of Rs 115 on the stock of DCB Bank, thus implying gains of nearly 24% from the current price of Rs 91.
Axis Securities says that it believes in the robustness of DCB's business model backed by its past performance of maintaining healthy asset quality despite multiple headwinds such as demonetization and GST roll-out which had impacted the bank's core customer base of self-employed borrowers.
DCB Bank: Strong asset quality led recoveries
"While growth has moderated in the past couple of years due to macroeconomic headwinds, DCB has managed to grow the book at 15% CAGR over FY16-21. The bank's minimal geographic concentration in contrast to most of its mid-cap peers highlights its balanced approach and is expected to bode well for its scalability perspective in the long term.
Though near-term headwinds exist, we expect the bank to successfully sail smoothly through the prevailing tough period backed by 1) Retail-focused diversified and secured portfolio, 2) ROA expansion through cost rationalization efforts and 3) Gradual improvement in the asset quality led by strong recoveries," the brokerage has said.
"We initiate coverage on DCB Bank with a BUY recommendation and a target Price of Rs 115 per share implying an upside of 24% from the current market price," the brokerage has said.
Buy Whirlpool of India, says Ashika Stock Broking
Ashika Stock Broking has suggested buying the stock of Whirlpool of India for good gains. The brokerage has set a price target of up to Rs 2,480 on the stock.
According to the broking firm, Whirlpool of India Ltd provides best opportunity in the White Goods listed space owing to its strong exposure to Refrigerators and washing machines compared to other listed players who are in single category.
"The penetration of Refrigerators and Washing Machines in India is low at 30% and 10% compared to other countries. Both categories are expected to benefit on account of up-scaling like in refrigerators segment, the technology is moving towards direct cooling to frost free, higher capacity and double door," the brokerage has said.
Whirlpool of India, gaining market share
The company has been gaining market share in volume terms and its product portfolio is poised to deliver strong structural growth over the next decade, beyond the low base-led growth due to the COVID-19 outbreak. In addition the formalization of economy is going to benefit the organized players like Whirlpool in white good segment.
"Whirlpool of India has identified Room AC, Cooking (Kitchen), Microwave, Water Purifier and Dishwashers as new avenues for growth. As the economy recovers from the lockdowns and on the onset of festive season, operating leverage should aid margin normalization and will help the company to reach the pre-COVID level business. Thus, we have positive view on Whirlpool of India and recommend to BUY the scrip with target of Rs 2,480 from 12 months investment perspective. The scrip is currently valued at P/E multiple of 39.9x on FY23E Bloomberg consensus EPS of Rs 53.5," the brokerage has said.
The above stock are based on the report of brokerage houses. Investing in stocks is risky and investors should do their own research. The author, the brokerage firms or Greynium Information Technologies are not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise due caution as are at record peaks. Please consult a professional advisor.