Stocks To Hold, Buy: ICICI Direct Assigns Hold Rating To Defence Stock, Buy To 3 Stocks

Leading brokerage firm ICICI Direct has assigned buy call to 3 stocks namely Mishra Dhatu Nigam, Sheela Foam, and Motherson Sumi Wiring India as the stocks are showing strong potential of good returns in 1-year target time period. If you buy these stocks today at the current market price, you can get maximum 27% return. The analyst has given hold rating to Mazagon Dock Shipbuilders. Check key details below:

1. Buy Sheela Foam

The current market price of the stock is Rs 2594 apiece. It has a market capitalisation of Rs 12,658 crore. ICICI Direct has assigned buy call to the stock with a target price of Rs 3300 apiece.

If you buy Sheela Foam at its current market price, you can get 27% return in a target time of 1-year. It has given maximum 95% return in last 3-years.

According to ICICI Direct, "We maintain our BUY rating on the stock. We value the stock at 50x FY24E EPS with revised target price of Rs 3300/share."

The mid cap company has improved its product offering in Australia and the Australian market remains to be stable with strong demand. SFL has maintained its 40% market share in Australia.

2. Buy Motherson Sumi Wiring India

The current market price of the stock is Rs 59 apiece and it has a market capitalisation of Rs 26,482 crore. It has given maximum 35% return in last 1-year and 28% return in last 6-months.

The brokerage firm has assigned buy rating to the stock with a target price of Rs 75 apiece. If you buy Motherson Sumi Wiring India now, you can get 27% return in a target time of 1-year.

According to ICICI Direct, "With fundamentals remaining unchanged, we retain our BUY rating on the stock. MSWIL is a good proxy to play upon the recovery in the domestic automobile space with superlative return ratio profile (RoCE ~40-50%) and structural levers for long term growth given the content/vehicle increase due to rise in electronic content in vehicles as well as electrification. Rolling over our valuations, we now value MSWIL at Rs 75 i.e. 40x P/E on FY25E EPS."

 

3. Buy Mishra Dhatu Nigam

The current market price of Mishra Dhatu Nigam (Midhani) is Rs 237 apiece and ICICI Direct has assigned buy call to the stock with a target price of Rs 285 apiece.

If you buy Mishra Dhatu Nigam at today's current market price, it has the potential to fetch you 20% return in a target time of 1-year. The stock has given maximum 164% return in last 5-years. It has jumped 32% in last 1-year and 17% in 3-months.

The mid cap company has a market capitalisation of Rs 4452 crore.

According to ICICI Direct, "Midhani has given a return of ~32% in the last one year (from ~Rs 186 in December 2021 to ~Rs 246 levels in December 2022). Aided by a healthy demand environment from both defence and space segment, we expect a healthy pick-up in the topline, going forward. Hence, we upgrade the stock from HOLD to BUY. We value Midhani at Rs 285, 22x FY24E EPS."

Mishra Dhatu Nigam (Midhani) is a leading manufacturer of special steel, super alloys and titanium alloys catering to niche end-user segments like space, defence, etc.

4. Buy Mazagon Dock Shipbuilders

The current market price of the Defence stock is Rs 874 apiece. It has a market capitalisation of Rs 17,627 crore. ICICI Direct has assigned hold rating to the stock with a target price of Rs 1025 apiece. The stock has given maximum 233% return in last 1-year and 113% return in last 3-months.

According to ICICI Direct, "We expect MDL to deliver earnings CAGR of 24% in FY22-24E led by 18% revenue CAGR (on better execution) and sustainable margins. We downgrade our recommendation on the stock from BUY to HOLD."

Mazagon Dock Shipbuilders (MDL) is engaged in the construction and repair of warships and submarines for the Ministry of Defence (MoD) to be used by the Indian Navy along with other vessels for commercial clients.

 

Disclaimer

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