It's perhaps not the best time to invest large sums, given that the stock indices once again have hit new peaks. Rising variants of covid have failed to worry investors. Many retail investor seem to continue to remain bullish on the markets.
"Over the coming week the focus would continue to be on corporate earnings, as market participants try to gauge the sustainability of the earnings upgrades seen during the last couple of earning seasons. Another factor to watch is the rise in the delta variant cases in US as also in certain parts of Europe," says Dr. Joseph Thomas, Head of Research, Emkay Wealth Management.
For those who are optimistic, here are 4 stocks to buy, based on reports from brokerage firms.
Broking firm, Motilal Oswal has a "buy" rating on the stock of tyre major, CEAT. The firm believes that cyclical recovery in both OEMs and replacements would enable the faster absorption of new capacities and drive the benefit of operating leverage.
"Coupled with the gradual pass-through of cost inflation, this would support margins over the medium term. Valuations at 11.3x FY23E consolidated EPS do not capture the ramp-up in new capacities in an improving demand environment, which would lead to margin recovery. Maintain Buy, with target price of Rs 1,775 (13x Sep'23 consol EPS)," the broking firm has said.
Shares of CEAT were last trading at Rs 1,372 on the NSE.
Emkay Global has a buy call on the stock of Bajaj Auto. The firm expects strong momentum in exports to continue, while domestic volumes should recover swiftly ahead. The focus on EVs has increased with the incorporation of a separate subsidiary for manufacturing 2Ws, 3Ws and 4Ws. "We expect a strong volume upturn with a 12% CAGR over FY21-24E, led by growth of 12% in 2Ws and 20% in 3Ws. We trim FY22-24 EPS estimates by 4-5%, mainly on lower margin assumptions," the brokerage has said.
Emkay global has reaffirmed a Buy with SOTP-based target price of Rs 4,420 (Rs 4,340 earlier), based on 18x P/E on Sep'23E (earlier Mar'23E). The target multiple implies a core P/E of 18x and cash/share of Rs722. "KTM is valued at Rs140 per share based on a 12x P/E and a 20% holding company discount. Key downside risks are lower-than-expected demand in key geographies, increase in competitive intensity and adverse currency/commodity prices," the firm has said.
Bajaj Auto shares were last trading at Rs 3,846.
Broking firm, Motilal Oswal has a buy call on the stock of IT company Mphasis. The stellar growth in the Direct channel (+9.8% QoQ CC; +32.5% YoY CC) was encouraging, the broking firm has said.
"However, the strong momentum was partially offset by an 18.1% QoQ/48.7% YoY decline in the DXC business," Motilal Oswal has said. We would revisit our estimates post the earnings call. We await further clarity on the near-term outlook, DXC channel, and margin. We maintain our Buy rating," the broking firm has said.
Brokerage firm, Emkay Global has a buy call on the stock of Polycab and has recommended buying the stock for a Rs 2060 upside target from current levels. "We remain constructive on Polycab, considering its consistent focus on strengthening balance sheet, as well as potential for margin improvement with the full benefits from ‘Project Udaan' kicking in," the brokerage has said.
"Weak Q1 print leads us to cut FY22E earnings by 7%, but we maintain FY23 and FY24 estimates. Revenue growth and margin recovery will be the key monitorables, going forward. Maintain Buy on the stock of Polycab, with a target price of Rs 2,060," Emkay Global Financials has said.
Investing in stocks is risky and investors need to be cautious. Neither Greynium Information Technologies Pvt Ltd nor the author, nor the brokerages would be responsible for any losses incurred based on decisions made from the article.