Stock To Buy, Oct 13: PL Suggests Finance Stocks After Q2 Results, TP Rs 3000

Prabhudas Lilladher on Friday recommended investors to buy mid cap finance sector stock, HDFC Asset Management Company Ltd shares with target price of Rs 3000 apiece after the company declared its Q2 results. HDFC AMC shares hit fresh 52-week high for 3rd consecutive day today on BSE. Current market price of HDFC AMC share on BSE is Rs 2881.50 per share. HDFC AMC stock gained 5.85% in last 1-week only, soared 24% in last 3-months, and offered return of 50% in last 1-year. Check details below:

HDFC AMC Stock Outlook & Return: Current market price of HDFC AMC share on BSE is Rs 2880.95 apiece. The stock recorded a spurt in volume today by more than 5.71 times. The stock has been witnessing spurt in volume in the last few days. HDFC AMC stock gained 61% in last 6-months, soared 32% YTD, fell 0.55% in last 2-years, and gained 110% in last 5-years.

Earlier, it informed BSE on September 25, "In continuation to our previous communication dated July 24, 2023, with respect to approval of the Board of Directors for additional investment of Rs 25,00,00,000/- in equity share capital of Wholly Owned Subsidiary ("WOS") viz. "HDFC AMC International (IFSC) Limited. In this connection, we would like to inform that the Company has invested an amount of Rs 25,00,00,000/- in its WOS and continues to hold 100% of the total paid up share capital of WOS."

HDFC AMC Valuation: According to Gaurav Jani, Research Analyst, Prabhudas Lilladher Pvt Ltd, "HDFC AMC saw a strong quarter; while QAAuM growth was in-line (+8.1% QoQ), revenue was a 4% beat to PLe leading to better blended yields at 49bps (47bps in Q1'24). Retail presence improved suggested by 1) individual MAAuM higher than industry and 2) larger pie in unique investor additions. With HDFB gaining control post-merger, sales would be boosted due to stronger distribution focus. A rise of 10% in share of HDFCAMC sales by HDFCB could lead to a 4%/5% increase in AAuM and core profits. We see a core PAT CAGR of 13.6% over FY23-25E. Stock is trading at 32x; we maintain multiple at 35x (5-yr avg. of 40x) but as we roll forward to Sep'25E core EPS, our TP increases from Rs2,800 to Rs3,000. Retain BUY."

Disclaimer

The stock has been picked from the brokerage report of Prabhudas Lilladher. 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 taking any investment decision.