Buy & Accumulate 4 Stocks In November For Upto 35% Gain, Top Brokerages Suggest

With a flat market trend, Sensex closed at 61,750.60 points and Nifty closed at 18,343.90 points. However, here 4 stocks have been mentioned to buy and accumulate, as suggested by Motilal Oswal and Prabhudas Lilladher.

Home First Finance

Home First Finance is being traded at around Rs. 671/share, and Motilal Oswal has suggested to buy this stock with Rs. 900 target price, for 34% potential return. In Q2 FY23, disbursements grew 36% YoY to Rs. 7b, leading to an AUM growth of 36% YoY to Rs. 62.8b. AUM growth was marginally impacted by subsidy received under the PMAY scheme. Reported spreads were stable sequentially at 5.8%, while reported NIM expanded 10bp QoQ to 6.5%. "HomeFirst's asset quality should exhibit strength and credit costs are likely to remain benign over FY23E-FY25E as there are no sticky NPAs from the past. With an RoA/RoE profile of 3.8%/15.6% by FY25E, we believe that the current valuation of 2.9x FY24E P/BV presents an attractive entry point to a quality franchise," the brokerage firm said.

ONGC

ONGC is being traded at around Rs. 142/share, and Motilal Oswal has suggested to buy this stock with Rs. 192 target price, for 35% return. ONGC's 2QFY23 EBITDA was in line with our estimate at Rs. 188.1b, with 42% YoY increase, with oil realization at USD72/bbl. Crude oil and gas sales stood at 4.8mmt and 4.2bcm, respectively. After a long time, the production of oil and gas appears improving. Domestic production of oil is expected at 22.8mmt in FY23, 24.6mmt in FY24 and 25.7mmt in FY25. According to the brokerage firm, "With no end in sight to the Russia-Ukraine conflict and proactive quota management by OPEC+, we expect Brent crude oil prices to stay elevated at ~USD100/USD90 per bbl in FY23/FY24, respectively. ONGC is trading at 2.2x FY24E EPS of 63.8 on consolidated basis. We value the company at 3.5x FY24E Adj. EPS of Rs. 43.4."

ABB India

ABB India is being traded at around Rs. 3028/share, and Prabhudas Lilladher has suggested to accumulate this stock with Rs. 3291 target price. The stock reported strong quarterly performance with revenue growth of 19.2% YoY, Sales came in at Rs. 21.2bn, up 19.2% YoY. EBITDA margins expanding by 45bps YoY to 10%, led by operational efficiency and cost optimization, while adjusted PAT grew 40.6% YoY to Rs. 1.7bn. The brokerage firm said, "Given robust enquiry pipeline, penetration in Tier 3 & 4 markets driving volume growth across businesses and focus on operational efficiencies, we have revised our earnings estimates upwards by 4.9%/3.9%/5.6% for CY22/CY23/CY24. The stock is trading at PE of 94.8x/76.1x/61.6x CY22/23/24E."

Aurobindo Pharma

Aurobindo Pharma is being traded at around Rs. 492/share, and Prabhudas Lilladher has suggested to accumulate this stock with Rs. 550 target price. Its API sales grew strongly by 24% YoY on increased demand in key products. "Aurobindo Pharma's (ARBP) performance was weak in H1FY23, given cost headwinds and lower US sales. We believe cost pressures to remain in near term and margin trajectory should improve from H2FY23. However, pick up in US sales hinge on timely niche approvals along with stabilization of pricing pressure in base business. ARBP has multiple growth drivers in place with investments in vaccines, injectables, biosimilars and PLI, which are expected to be reflected from FY24," Prabhudas Lilladher said.

Disclaimer

The above stocks were picked from the brokerage reports by Motilal Oswal and Prabhudas Lilladher. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.