4 Mid & Smallcap Stocks To Buy Today, For Upto 30% Returns

Brokerage firm Sharekhan has recommended buying the stocks of Symphony, Amber Enterprises, Atul Ltd and GNA Axles in its latest report. Here are reasons, why the country's top brokerage has suggested buying these stocks.

Symphony: Buy the stock for 28-30% returns, says Sharekhan

Sharekhan has set a 28 to 30% higher returns on the stock of Symphony from current levels. "Despite new entrants like Voltas, Havells India and Blue Star, Symphony has managed to remain undisputed leader with a share of 50% in the organised market for air coolers.

Symphony's high brand recall, superior product portfolio and pan-India presence with deep distribution network gives it an edge over competitors. We expect that despite a muted H1FY2023, the company's performance should improve in the medium term given healthy demand scenario and company's efforts to grow exports. Further, easing of commodity prices, higher contribution from international business (particularly exports to US) and rationalizing of costs through value engineering should help the company improve its margin trajectory in the medium to long-term. Moreover, direct to consumer (D2C) initiatives through e-commerce, rise in sales of industrial and commercial coolers and traction in large space ventilated air cooler (LSV) are the long-term growth triggers. We remain positive on the stock and expect an upside of 28-30%," the brokerage has said.

 

Amber Enterprises: Buy with a price target of Rs 2530

For Amber Enterprises, the brokerage has a price target of Rs 2530. "The management remains optimistic about growth in components (including mobility, electronics, and non-RAC components) as well as exports in the next 3-4 years. Further, under penetration of RAC, rising temperatures in India, changing lifestyle patterns and increasing contribution from Tier II,III,IV cities would drive the RAC industry growth and benefit Amber. Overall, we believe the company's strong long-term prospects as an all-round player in the AC space will be driven by expanding its customer base and widening product supplies aided by recent acquisitions. The stock has corrected sharply in the recent past and we believe near-term margin pressure is largely factored in. Hence, we maintain Buy with a revised price target of Rs. 2,530, valuing the stock on September FY2024E EPS," Sharekhan has said.

 

Atul Ltd

For Atul, the brokerage has a price target of Rs 8880. "The POC segment's margin continues to see weakness and is likely to remain under pressure in the near term, while it is unlikely that the LSC segment's margins remain sustainable as those achieved in Q2FY2023. The rich valuation of 36.2x/27.7x its FY23E/FY24E EPS limits the upside potential from the CMP. Hence, we retain our Hold rating on Atul with a revised price target of Rs. 8,880 (reflects lower PE multiple and earnings cut for FY2024E EPS)," the brokerage has said.

 

GNA Axles

For GNA Axles the brokerage has a price target of Rs 841, against the current market price of Rs 673.

"The stock is available at attractive valuations of 10x P/E and 5.7x EV/EBITDA its FY2024E estimates. We reiterate our Buy recommendation on the stock with a revised price target (PT) of Rs. 841," the brokerage has said in its report.