3 Stocks To Buy, Sell, Add: ICICI Securities Rates 3 Top Stocks, Initiates Buy, Sell, Add Call

1. Buy Hindustan Aeronautics

The current market price of Hindustan Aeronautics Ltd is Rs 2682 apiece with an intraday gain of 0.02%. The Navratna defence stock has a market capitalisation of Rs 89,707.81 crore. Hindustan Aeronautics Ltd (HAL) is a large cap company that operates in the Defence sector. The company has declared the first interim dividend of Rs 20 per equity share on November 11, 2022 and fixed record date for the same that is November 21, 2022.

The stock has given multibagger returns with maximum return of 233% in last 3-years. The shares hit new 52-week high today.

ICICI Securities has assigned buy call to HAL with a target price of Rs 3170 apiece. Buy Hindustan Aeronautics at the current market price of Rs 2682 apiece and a potential return of 18%.

According to ICICI Securities, "We see HAL in a sweet spot, riding on its solid orderbook (highest among defence companies under our coverage). In our view, strong order pipeline along with development projects in progress are likely to maintain earnings momentum in medium to long run. We maintain BUY rating on the stock with target price of Rs3,170/share based on DCF methodology. Delay in execution is a key risk to our thesis."

2. Sell Garden Reach Shipbuilders & Engineers

The current market price of the small cap company is Rs 495 apiece with market capitalisation of Rs 5677 crore. The stock has given multibagger returns with maximum return of 122% in last 3-years. The stock has given a return of 82% in last 3-months. The company operates in Shipping sector.

ICICI Securities has maintained sell call to Garden Reach Shipbuilders & Engineers. Sell Garden Reach Shipbuilders & Engineers with a target price of Rs 390 apiece.

According to ICICI Securities, "Garden Reach Shipbuilders & Engineers' (GRSE) Q2FY23 performance missed consensus estimates. In our view, GRSE stock has given an impressive return of 70% in the past three months, mainly on (likely) robust earnings momentum till FY25 and orders on anvil. However, we see earnings sustenance beyond FY25 nebulous as for major potential orders, RFP is yet to be floated, notwithstanding the competition with other shipyards. We re-initiate coverage on GRSE with SELL. Our TP of Rs390 is based on DCF methodology, implying P/E of 6x FY24E EPS, which could be the peak earnings for the company."

3. Add United Spirits

The current market price of the large cap beverages stock is Rs 882 apiece with market capitalisation of Rs 64158 crore. The stock has given a maximum return of 41% in last 3-years.

According to ICICI Securities, "In our view, UNSP's stock appears well poised to gain (in absolute terms) in the immediate near term from potential price hike benefits. We have an ADD rating and a 12-month target price of Rs940."

We reiterate ADD on UNSP as we believe UNSP under Hina's leadership is targeting double-digit revenue growth over the medium term through Portfolio reshape. The key pillar of Portfolio re-shape includes (1) strong growth on P&A, (2) new growth engines and (3) value chain efficiency extraction. In our opinion, (select) part of the street getting concerned on no immediate (optical) benefit, is too myopic. We believe focused approach can accelerate the journey (much efficiently). Inflationary RM can potentially lead to some short-term pain (in terms of margins) with UNSP looking to invest behind premium brandsm added ICICI Securities.

Keys risks: 1) Higher than expected raw material inflation; and 2) a potential ban of spirits in states.

Disclaimer

The stocks have been picked from the brokerage report of ICICI Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.