Top Stock Picks: 6 Stocks To Buy For Good Potential Upside In 3 Months

The brokerage firm ICICI Securities has suggested six gladiator stocks to buy for good potential upside in a target period of 3 months. There are total of 5 open stock recommendations which are Info Edge (target price: Rs 5,380.00), Birla Soft (target price: Rs 524.00), Tech Mahindra (target price: Rs 1,690.00), Bharat Electronics (target price: Rs 245.00), and Siemens (target price: Rs 2,740.00). The brokerage has also issued a new stock recommendation, Lemon Tree, with a target price of Rs 68.00 and a stop loss of Rs 52.40.

Buy Lemon Tree Hotels

The brokerage has stated about the stock Lemon Tree Hotels (LEMTRE) that "The hospitality sector has been underperforming over the past several years dating back even to the pre-Covid period and has undergone significant price/time correction. Many stocks are now breaking out of their multi-year consolidation phase, indicating a structural turnaround. Within hospitality space, our preferred pick is Lemon Tree Hotels."

According to ICICI Securities "Buying demand is seen emerging in the stock from the vicinity of rising 52 week's EMA (currently at Rs 47) in the last one year after underperforming for preceding three years, highlighting structural change. We expect the stock to maintain positive bias and head towards Rs 68 levels in the coming months as it is the price parity with the previous up move (Rs 36-60) as projected from recent trough of Rs 43. Among oscillators, the weekly MACD has generated a buy signal, thus validating positive bias."

The brokerae has also claimed that "The company plans to add 738 rooms (669 rooms in Mumbai, 69 rooms in Shimla) over the next two years with total capex of Rs 1006 crore. Post completion of expansion, LTHL will be operating ~10,462 rooms in 105 hotels across 64 destinations, in India and abroad by FY24E. The company has already spent Rs 399 crore (up Rs 11 crore QoQ). It plans to incur Rs 250-300 crore over the next 12 months, another Rs 250 crore over next nine months, thereafter, and balance post that. We expect Aurika Mumbai to get launched during November-December 2023."

"The current cost of building a new hotel room has increased to Rs 1 crore vs. Rs 50 lakh earlier. These would moderate the new launches in the hotel space. The company is well positioned to capture the unorganised market share due to slowdown in the upcoming room supply in the wake of ongoing distress. We believe the company's large asset base, strategic partnership and financial flexibility would continue to support the liquidity profile, if further need arises," noted the brokerage.

Gladiator Stock Picks By ICICI Securities

Stocks	Recommendation price in Rs	Target price in Rs	Stoploss in Rs	Duration
Lemon Tree	57.50-59.30	68	52.4	3 Months
Info Edge	4,703.00	5,380.00	4,315.00	3 Months
Birla Soft	462	524	414	3 Months
Tech Mahindra	1,493.00	1,690.00	1,328.00	3 Months
Bharat Electronics	213.5	245	192	3 Months
Siemens	2,368.00	2,740.00	2,135.00	3 Months
Source: ICICI Direct Research. Data as of 25th March 2022

Disclaimer

The stocks have been picked from the brokerage report of ICICI Securities. Investing in equities poses a risk of financial losses. 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.