To pick a handful of stocks that can help in wealth creation over the short to long term is not everyone's cup of tea. And at current record highs that the Indian markets are seeing every other day on positive global news flow, it is indeed a tougher task. Here are some top picks by brokerages for 2021:
It is among HDFC Securities' top 10 stock picks for 2021 and last quoted at 1240.30 apiece. The company informed of large deal wins having a combined contract value of $ 3.15 billion, the highest ever reported in Q2FY21 that includes the mega-deal with Vanguard. Also, the IT major despite cost controlling and other cash conservation techniques taken on to by clients is able to see improvement in IT deal pipeline continuously. Furthermore, the company's financial position remains strong owing to a debt-free balance sheet and strong ability to generate cash as in the past. As on September 30, 2020, cash and cash equivalent at the IT firm was at Rs. 26,011 crore.
And now as the historic Brexit deal has been agreed to between the European Union and the UK and will come into force from January 1, Infosys being a Brexit-linked counter after conquering the resistance range of 1150-1200 is heading towards Rs. 1500 from a short term outlook. The support is placed at Rs. 1150 levels. Besides, if there is seen some abrupt downside in the counter, the weekly chart suggests a strong buying momentum in Infosys at levels of Rs. 1175.
2. Bharat Forge:
This castings and forgings company at the closing of December 28, 2020 quoted at Rs. 527.8 apiece on the NSE. And this scrip has been shortlisted as a short term trading pick by HDFC Securities while ICICI Direct has given its buy recommendation on the counter for 2021 based on Future & Options and Quantitative indicators.
While the stock continues with its upward momentum, there has been seen strong delivery volumes-which as per the brokerage's view is a sign of aggressive buying. "Mean levels for Bharat Forge have acted as trend decider for the stock. It has witnessed significant directional moves after breaching these levels on either direction in the past. The recent up move above | 450 levels is likely to trigger the fresh positive bias in the stock," the brokerage firm said. Buying is suggested in the range of Rs 525-550 with a stop loss of Rs 455. For a 1-year outlook, the target price for Bharat Forge is set at Rs. 690.
3. Bharti Airtel:
The leading brokerage and research firm ICICI Direct has given a 'Buy' call for Bharti Airtel and has chosen the counter in its quant picks for 2021. For a timeframe of 1 year, the price target for the telco is kept at Rs. 620. As at the close of December 28, 2020, the scrip settled at Rs. 521.6 per share.
As per the firm, of late volatility in the counter has reduced substantially which favours a possible upside. "Bharti Airtel has seen sharp moves last year as it move out of the range prevailing for the last many years. With liquidity flow likely to remain higher, stocks like Bharti Airtel are likely to outperform. Moreover, the stock is likely to remain positive till it holds above its long term mean levels in the coming months," said the research firm's report. Besides an uptick in delivery volumes at lower levels is indicative of likely healthy gains in the counter, added the report. Buying is suggested in the range of Rs 490-510 with a stop loss of Rs 440.
Dr. Reddy's Lab PT- Rs. 5656.3
Following pricing pressure for the lost several years, price erosion is now showing a declining trend in the US market. Lower number of drug filings as well as limited US-FDA plants provided a support.
Analysts at Nomura expect the generic launch of vascepa (cardiovascular) and progress on copaxone (multiple sclerosis), nuvaring (contraceptive) and rituxan (auto immune disorder) as the key products to watch out for.
Highlights from the company show that going forward it expect more approvals in the complex generic category not yet in the public domain. Also positive news flow on the Sputnik V vaccine will also aid in revenue growth.
Consolidation and recovery in the domestic market coupled with incremental growth from acquired Wockhardt's products should aid performance.
CMP- Rs. 5237.5
Target price- Rs. 5656.3
Upside- Of over 8%
Change on a YTD: 80%