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4 Stocks You Must Own Now For Gains Of 20% In The Short-Term

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Markets have been on a decent run in the last few weeks, as investors ignore further increase in interest rates by the central banks. Here are 4 stocks that you can buy before they turn expensive.

 

Buy the stock of SBI for gains of 20% and more

Buy the stock of SBI for gains of 20% and more

Emkay Global has a buy rating on the stock of State Bank of India for a price target of Rs 640, which means gains of plus 20%.

State Bank of India remains one of our preferred picks, given its healthy growth trajectory and improving RoA/RoRWA/RoE profile. SBI has come a long way and is now far better placed in terms of delivering sustained profitable growth, but it still trades at cheap valuations (1x FY24E ABV). That said, the bank will have to shore-up capital buffers by tapping capital market/unwinding value in subsidiaries. We retain Buy/OW in EAP with a target price of Rs 640, valuing the core bank at 1.3x June 24E ABV and subs/investments at Rs 207," the brokerage firm has said.

Buy Titan Company
 

Buy Titan Company

For Titan Company, Emkay Global sees gains of 11% on the stock. The firm has set a price target of Rs 2700 on the shares of the company.

Ex-bullion sales, consol. EBITDA margin at 13.2% was 200bps higher vs. pre-Covid, led by operating leverage, exit from loss-making ventures and ~80 bps one-off gain due to increased diamond prices. "Going ahead, Titan expects jewellery margins to remains stable with focus on acquiring new buyers and gaining share in wedding/low penetration states. We believe return of the pre-Covid margin profile in watches (~13%) and turnaround in eyewear/Caratlane should boost margins in FY23E," the brokerage firm has said.

Target of Rs 2700 on the stock of Titan

Target of Rs 2700 on the stock of Titan

Titan ffers high-teens growth visibility and an improving RoIC profile (~45% by FY25E), led by low penetration and focus on improving product assortment + profitability turnaround in eyewear/Caratlane businesses. A faster traction in Taneira, handbags, and international operations remains a potential upside. "We maintain Buy with a revised target price of Rs 2,700 (Rs2,530 earlier), valuing Titan at a reduced multiple of 50x (vs. 51x earlier) due to 3M rollover," Emkay Global has said.

Buy the stock of Mahindra and Mahindra

Buy the stock of Mahindra and Mahindra

Mahindra and Mahindra's (M&M) Q1FY23 revenue grew 15% qoq (3-year CAGR at 15%) to Rs196bn, mainly below estimates, due to lower-than-expected realization in the farm equipment segment (FES). EBITDA grew 20% (3-year CAGR at 9%) to Rs23.4bn, 5% below our estimates, on account of lower-than-expected margin at FES. Management expects favorable commodity prices to reflect in Q3.

Price target of Rs 1390 on the stock of Mahindra and Mahindra

Price target of Rs 1390 on the stock of Mahindra and Mahindra

We have reduced our FY23-24E EPS forecast by 2-3% owing to lower margin assumptions. Following the revision, we have built in revenue/earnings CAGRs of 22%/25% over FY22-24E. Auto revenue should see a strong 29% CAGR and farm revenue is likely to witness a 10% CAGR. "We maintain Buy with a target price of Rs1,390 (unchanged), based on 11x standalone Sep'24E EPS (DCF-based) and the value of subsidiaries/investments at Rs646/share," the brokerage has said.

 Upside target price of Rs 375 on the stock

Upside target price of Rs 375 on the stock

Emkay Global values BPCL on an SOTP basis, with investments at a 30% holdco discount. "We have lowered our target multiple due to low earnings visibility, while rolling it over to Sep'24. We downgrade BPCL from Buy to Hold with eyes on macros and potential policy support. In Q1, however, it fared better than HPCL though with some BV erosion, but IOCL was still a much better performer. Resumption of upstream projects with positive outcome is also a trigger," the brokerage has said.

According to it, the key risks are adverse commodity/currency/polices and project issues.

Read more about: stocks to buy
Story first published: Tuesday, August 9, 2022, 9:15 [IST]
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