It was a bad week for the market, as benchmark indices came crashing down after the recent worries over the threats of war between North Korea and the US. In fact, the Indian markets saw their biggest weekly fall in 18 months. Here are a few stocks that you could buy if there are further declines.
Shares of Tata Motors have not only plunged to a 52-week low, but have gone as far as hitting a 15-month low. Performance of the company was not satisfactory and the net profit grew by 41.6 percent year-on-year to Rs 3,200 crore, which was largely due to a one-time gain of Rs 3,609 crore. This was with regards to JLR's defined benefit pension plans. However at Rs 377, the stock may not be a bad bet at all. For one there are hopes that there could be a good an improvement in margins and the drop in the stock price of Tata Motors maybe very excessive.
What brokerages are saying on Tata Motors
Many brokerages are still bullish on Tata Motors, despite the weakish set of numbers. "We have downgraded consolidated EPS by 27/7 percent for FY18/19, factoring in cost pressures in Jaguar Land Rover and a stronger rupee, but upgraded S/A EPS (lower interest and depreciation)," Motilal Oswal said while maintaining buy rating with a target price of Rs 542. Brokerage firm Edelweiss has lowered its price target to Rs 444, which is almost 15 per cent jump from the current market price. Tata Motors maybe a good stock to buy on declines.
Sun TV Network
This is a stock that used to be terribly expensive at Rs 976. However, the recent fall in the share price to Rs 676, has made the stock attractive all over again. This is a good stock to bet on for a number of reasons and not only the share drop. Sun TV Network is a cash rich company with zero debts. The company runs the "Sun" group of television channels that virtually dominates in the south. As digitization picks up in the company's key markets, there is a big scope of revenues picking up from digitization. The Aircel Maxis cases against the Maran Brothers has also been dismissed, which is a big positive for the stock.
Decent dividends and growth prospects
There is a possibility that Sun TV reports an EPS of Rs 35 by 2018-19. If you value the company at a p/e of around 25 times, given its sheer presence in the South and also its debt free status, the stock should trade at Rs 875 at the very least in the coming two years. This means the stock, which is now trading at Rs 676, has the possibility of giving at least 30% per cent returns in the next two years. The dividend yield on the stock is almost 3 per cent, which is now as good as a bank saving rate interest.
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