With a spike in metal stocks, benchmark market indices rise; IT stocks top gains. Banking stocks have pared their losses. ICICI Securities, a brokerage firm, estimates that the stocks listed below have enough momentum to create gains of up to 19 percent over the next 12 months. Let's look at why the brokerage is optimistic about these stocks.
Buy the stock of Tata Consumer Products for 19% upside
Broking firm, ICICI Securities has said to buy the stock of Tata Consumer Products with an upside target of 19% on the stock. According to the broking firm, TCPL has 1500 distribution points in India, reaching 0.82 million outlets directly, with a target of 1.0 million outlets by September 2021. The company is also expanding its rural presence with 3x feet on the street, 2000 rural distributors, and 300 super stockists.
"TCPL's share price has moved up 5.5x in the last five years (from Rs 140 in August 2016 to Rs 759 in August 2021). We roll over FY24 numbers on expectations of continued growth momentum with health, ayurveda & natural consumption tailwinds We continue to maintain BUY rating on the stock Target Price and Valuation: We value the stock at Rs 900 ascribing 55x FY24 earnings multiple," the brokerage has said.
|Current Market Price||Rs 759|
|Target Price||Rs 900|
Buy Kalpataru Power: ICIC Securities
Brokerage firm, ICICI Securities also has a buy call on the stock of Kalpataru Power, with a 16 % upside target from the current levels.
According to the broking firm, for FY22E, management expects revenue growth of 10% to 15%, with order inflows of Rs 9000 crore (5000 crore in T&D and Rs 2000 crore each in railroads and oil and gas). For FY22E, margins are likely to remain in the double digits.
"We believe monetisation of non-core assets to improve balance sheet health and return ratios in the long run. We remain long term positive and retain our BUY rating on the stock. Target Price and Valuation: We value KPTL at Rs 550 on an SoTP basis," the brokerage has said.
|Current Market Price||Rs 475|
|Target Price||Rs 550|
Buy Titan: ICICI Securities
The brokerage is also bullish on the stock. The brokerage says Titan has repeatedly demonstrated its capacity to acquire market share in a challenging industrial environment, owing to its solid balance sheet (30 percent+ RoCE and cash & investments of Rs 2000+ crore) and brand loyalty.
"Titan has been an exceptional performer in the discretionary space with stock price appreciating at ~34% CAGR in last five years. We continue to remain structurally positive and maintain BUY rating Target Price and Valuation: We value Titan at Rs 2110 i.e. 60x FY24E EPS.
Working capital management has been a top goal for the corporation, which has kept inventory under tight control and placed a greater emphasis on gold on lease replenishment. As a result, the company's cash position has significantly improved." the brokerage has said.
|Current Market Price||Rs 1800|
|Target Price||Rs 2110|
Buy Transport Corp; ICICI Securities
ICICI Securities has a buy call on Transport Corp., but believes the stock has a 17 percent upside from present levels. TCI had great results, outperforming expectations on all fronts. Revenues increased by 86 percent year on year to Rs 611 crore, with freight, SCM, and shipping revenue increasing by 82 percent, 106 percent, and 68 percent, respectively.
"TCI has been continually improving its margin profile by efficiently handling its fleet utilisation and other cost control measures, which has led to a sharp run-up in the stock. •We remain positive on the stock and maintain our BUY recommendation Target Price and Valuation: We value the stock at | 520 (SOTP).
TCI captures higher wallet share of its customers by providing diversified range of services via a single window. The variety of services also helps TCI to ride over volatile periods," the brokerage has said.
|Current Market Price||Rs 445|
|Target Price||Rs 520|
The above stocks are based on the report ICICI Securities. Investing in stocks is risky and investors should do their own research. The author, the brokerage firms or Greynium Information Technologies are not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise due caution as are at record peaks. Please consult a professional advisor.