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Buy 1 Small Cap & 1 Multibagger Mid Cap Stock For Returns Upto 19%, Says Ashika Stock Broking
Ashika Stock Broking, a renowned brokerage firm, has maintained its positive outlook on two small-cap stocks in its report published on November 19, 2022. These two stocks are Krishna Institute Of Medical Sciences Ltd. (KIMS) & Affle (India) Limited. Both the companies has reported robust 2QFY23 Revenue growth. Here are the key takeaways from the report:
1. Krishna Institute Of Medical Sciences Ltd. (KIMS)
KIMS is a small cap Hospital & Allied sector company having a market cap of Rs 11,832.11 crore. The brokerage has given a buy call to the stock with a target price of Rs 1,735 per share. The brokerage claims a potential upside of up to 18% from its current level with the given target price. KIMS stock on NSE last traded at Rs 3,120.40 apiece, down 4.50% from its previous close. The 52 week low of the stock is Rs 2,953 and the 52-week high is Rs 4,043, respectively.
It has given a negative return of 6.21% in the past 1 week. In the past 1 and 3 months, the stock surged, giving a positive return of 5% in 1 month and 21.26% in 3 months, respectively. In the past 1 year, it gave 17.55% positive returns on investments. Since its listing on 28 June 2021, the stock has given 48.3% positive returns.
Reported robust 2QFY23 revenue growth
KIMS has a strong footprint in Telangana and Andhra Pradesh, and has a total capacity of 4,000 beds across 13 operating hospitals. Execution is a key forte of KIMS as evident from the consistent scale-up in revenues and margins. It reported robust 2QFY23 revenue growth on account of Sunshine & Kingsway merger with base business showing improvement of 60 bps at EBITDA level clearly indicating cost rationalization efforts fructifying.
Turnaround of Sunshine will be key driver for KIMS overall EBITDA as there is big room to grow EBITDA margin from 18% to 25%, once occupancy picks up at Sunshine. Management is further confident of closing one-two deals in upcoming quarters leveraging their healthy balance sheet & operating cashflows.
2. Affle (India) Limited
Affle (India) is mid cap services sector company having a market cap of Rs 16,794.30 crore. It is a global technology company with proprietary consumer intelligence platform that delivers consumer acquisitions, engagements and transactions through relevant mobile advertising.
The brokerage suggests buy with an estimated target price of Rs 1490 per share. According to the given target price, the stock is likely to give a return of up to 19% if the stock is bought at the current market price. Affle India share price on NSE is Rs 1,253.65 per share, closed after falling 2.07% as compared to its previous close. The 52-week high level of the stock is Rs 1,511 and 52 week low is Rs 871.55, respectively.
The stock surged 6.8% in the past 1 month and 2.28% in the past 3 months, respectively. Whereas, it has given 8.95% positive returns in 1 year. Over the past 3 years, the stock has given 272.98% multibagger returns. It was listed on the stock exchange on 8 August 2019 and since its listing, it has given a multibagger return of 621.31%.
Delivered mixed performance for Q2FY23
According to the brokerage, Affle India delivered mixed performance for Q2FY23 with reported revenues at Rs 354.6 crore, up 29.1% YoY, led by a rise in CPCU revenues that rose 31.8% YoY. EBITDA jumped to Rs 70.8 crore which increased by 36.1% YoY and 3.1% QoQ. EBITDA margin improved 103 bps YoY to 20% in Q2FY23. Net profitability grew by 40% YoY and 6.2% QoQ at Rs 58.7 crore. As per management, company is going to exceed its expectation on bottomline for FY23.
It will follow similar trend for next year too and is optimistic since they are focusing on emerging markets. The management cited that they expect the industry to grow 10% higher in H2FY23 compared to H1FY23, also as H2 is a festive period and with advertisers having additional budgets for the festive period they believe it should get evenly spent in Q3 and Q4. Given its minimal exposure in Europe and US and underpenetrated digital advertising in India and global emerging markets, Affle is well-positioned to deliver steady growth momentum.
Disclaimer
The stocks have been picked from the brokerage report of Ashika Stock Broking. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before making any investment decision.
