5 Midcap, Small Cap And Largecap Stocks To Buy From Broking Firm Sharekhan

Triveni Engineering & Industries: Buy this midcap stock

Sharekhan has a buy call on the stock of this midcap company. According to the broking firm, Triveni Engineering & Industries Ltd's (TEIL's) revenues grew by 22.5% y-o-y to Rs. 1,361.5 crore on back of 67% y-o-y growth in distillery segment's revenues to Rs. 379.3 crore, a 17% y-o-y growth in the core sugar business to Rs. 1,051.9 crore and a 33% y-o-y increase in the engineering business revenues to Rs. 95.7 crore. Gross margins and EBITDA margins decreased by 653 bps and 509 bps y-o-y, respectively to 22.0% and 8.4%. Excluding export subsidy of Rs. 45 crore in the base quarter, the EBIDTA margin decline would be of around 100 bps. EBIT of Sugar division was down by 43.8% due to higher cane prices, higher transfer prices and lower recovery. Distillery business EBIT grew by 44.2% y-o-y. This along with higher interest expenses led to 33% y-o-y decline in the adjusted PAT to Rs. 66.4 crore.

New distillery commissioned by Triveni Engineering

The company has commissioned new grain-based distillery of 60 KLPD in Muzaffnagar and an increase in the capacity of the existing distilleries at Muzaffarnagar and Milak Narayanpur by 40 KLPD each (from 160 KLPD to 200 KLPD), thereby increasing the company's overall distillation capacity to 660 KLPD. Further, the company has proposed new dual feedstock facility of 450 KLPD at Rani Nangal and Sabitgarh, UP with an investment of Rs. 460 crore. Its distillation capacity will stand augmented at 1,110 KLPD by Q3FY2024.

"Structural change in sugar industry, strong growth prospects of distillery business, and lean balance sheet will help maintain strong growth momentum in the medium to long term. We maintain our Buy recommendation on the stock with a revised price target of Rs. 285," the brokerage has said.

Indigo Paints: Buy the stock for a price target of Rs 2250

Sharekhan also has a buy call on the stock of Indigo paints. The company is focusing on gaining share in tier 1 and tier 2 cities where it has relatively good dealer presence. "Revamped strategy will help the company beat industry growth in the medium term (IPL targets growth at twice the industry's growth). This will help the company to achieve consistent revenue growth of 30% over FY2022-FY2024. This along with OPM expansion will enable PAT to post a 60% CAGR over FY2022-FY2024. The stock has corrected from its high and is currently trading at 48.1x/34.7x its FY2023/FY2024E EPS. We maintain our Buy recommendation on the stock with a revised price target of Rs. 2,250," the brokerage has said.

Buy the stock of Kalpataru Power

The brokerage also has a buy call on the stock of Kalpataru Power. "In the medium to long term, Kalpataru Power is hopeful of better execution and profitability as the company builds capabilities for large EPC projects and cost headwinds subside. Moreover, in the long term, management is optimistic on a healthy consolidated performance post-merger as cost synergies are likely to kick in. However, we expect subdued performance for the next couple of quarters due to execution delays and do not estimate any meaningful margin improvement in the near term. Hence, we see limited upside in the stock from the current price levels. Therefore, we downgrade the stock from Buy to Hold with a revised SoTPbased price target of Rs. 415," the brokerage has said.

JMC Projects: Buy the stock for a price target of Rs 92

JMC Projects has shown healthy execution pickup, which is expected to continue going ahead while OPM are expected to improve gradually. "Order inflows have been robust with a positive outlook for further order wins. However, the company has long standing claims of Rs. 1,700 crore in arbitration. Its road BOOT asset divestments remain awaited. The company is expected to merge with Kalpataru Power Transmission (KPTL) by Q4FY2023 with a swap ratio of 4:1. Hence, we expect JMC and KPTL to trade in sync with the swap ratio announced. We retain a Hold rating on the stock with a revised price target of Rs. 92," Sharekhan has said.

Titan: Price target of Rs 2900

Titan is aiming to grow its revenue at CAGR of over 20% over FY2022-27 on back of its ambitious growth plan in the medium term. "This along with consistent improvement in margins will help cash flows improve strongly in the coming years. FY2023 will be a strong year for the company on back of low base in the core businesses. Stock is currently trading at 67.9x and 53.7x its FY2023E and FY024E earnings. The company's strong growth outlook, industry tailwinds in the medium term and strong balance sheet makes it a best play in the retail space. Hence we maintain our Buy recommendation on the stock with an unchanged price target of Rs. 2900," the brokerage has said.