Stocks To Buy, Sell: ICICI Securities Gives Buy, Sell Call To These 2 Mid-Cap, Large-Cap Stocks

Leading brokerage firm ICICI Securities has assigned 1 buy rating and 1 sell to two stocks namely Blue Dart Express and Indian Oil Corporation (IOC). The brokerage recommends investors to buy the stock of IOC for a target price of Rs 85 and a potential return of up to 25%. The analyst has assigned sell call to Blue Dart Express with a target price of Rs 6768 apiece. Check key takeaways below:

1. Indian Oil Corporation Ltd

The current market price of IOC is Rs 68 apiece with 52-week high at Rs 94 apiece and 52-week low at Rs 65 apiece, respectively.

According to the brokerage, "We cut our estimates of 'other products' marketing margin for FY23E to Rs7,000/mt from Rs8,000/mt earlier. This reduces FY23E and FY24E recurring EPS to Rs13.2 and Rs13.3 respectively. Valuations of 5.1x FY24E P/E, 3.5x EV/EBITDA and 0.6x P/BV, are attractive. We believe dividend yield of ~11.7% and the support from CPCL earnings make risk-reward favourable for IOCL. Our FY24E EV/EBITDA-based valuation of Rs85/sh implies 24% upside. Maintain BUY." The key risk remains the continued suspension of fuel price hikes, more sustained downturn in GRMs, slowdown in fuel consumption.

The large cap company was incorporated in 1959 and it operates in Gas & Petroleum sector. The stock has fallen 51% in last 5 years, 30% in last 3-years, and 20% in last 1 year. It has a market capitalisation of Rs 96,518.66 crore.

2. Blue Dart Express Ltd

Blue Dart Express Ltd: The current market price of Blue Dart Express is Rs 7779 apiece with 52-week high at Rs 9639 apiece and 52-week low at Rs 5428 apiece, respectively. The company has a market capitalisation of Rs 18,458 crore. The stock has given a return of 86% in last 5 years, 224% in last 3 years, and 17% in last 1 year.

According to ICICI Securities, "we believe intensifying competition in the price-sensitive market is likely to pose the major headwinds for the company, likely resulting in incremental volumes coming at progressively narrower margins. We reinitiate coverage on BDE with a SELL rating. Our target price works out to Rs6,768/share based on 15x FY24E EV/EBITDA (corresponding to mid-cycle valuations as near-term returns might stay capped)."

In the near term, we expect the stock performance to be constrained due to increasing competitive pressures in both air and ground categories, added the analyst.
The mid cap company operates in Logistics sector and came into existence in 1991.

Disclaimer

The stocks have been picked from the brokerage report of ICICI Securities. 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.