BSE Sensex and Nifty 50 ended the monetary year 2020-21 on a powerful note, with all the sectors delivering positive returns. Among sectors, metals and IT registered the strongest gains whilst FMCG grew the slowest in the course of the year. Stocks from the auto and realty sector also delivered strong returns in the course of the fiscal. “While FY21 was very strong aided by cheap valuations and a low base but March was a mixed bag,” mentioned Naveen Kulkarni, Chief Investment Officer, Axis Securities. In the new monetary year 2021-22, the concentrate will stay on earnings development and sustenance of demand momentum.
Axis Securities has maintained its December Nifty 50 index target of 17,200. The brokerage firm mentioned that earnings development for the whole decade from 2010-2020 was really sluggish with an earnings CAGR of 7 per cent (doubling in 10 years). In the broader industry, mid and smallcaps have outperformed the substantial caps by a considerable margin in FY21. Domestic brokerage firm believes that this trend is most likely to sustain in FY22 as effectively as earnings development is anticipated to be incredibly powerful for the broader industry.
Top stock picks:
ICICI Bank: The brokerage firm has offered a target price tag of Rs 720, a rally of 24 per cent from the existing levels. Higher loan development, enhancing operating income, powerful provision buffer coupled with powerful deposit franchise will support ROAE/ROAA expansion more than FY22-23E for the bank.
State Bank of India: It will take SBI stock to jump 31 per cent from the prior close to hit the target price tag of Rs 477 pegged by Axis Securities. Among PSU banks, SBI remains the ideal play on the gradual recovery in the Indian economy, with a wholesome PCR, robust capitalization, a powerful liability franchise and an enhanced asset high-quality
outlook.
Federal Bank: The brokerage firm sees a 23 per cent rally in Federal Bank stock price tag, with price tag target of Rs 93 apiece. Axis Securities believes that essential positives are rising retail concentrate, powerful charge earnings, sufficient capitalisation (Tier-1 at 13%), and prudent provisioning.
Equitas Small Finance Bank: Domestic brokerage firm believes that Equitas Small Finance Bank is eligible for re-rating offered its enhancing profitability, asset high-quality and return ratios. It has offered a target price tag of Rs 72, a get of 20 per cent from the prior close.
Varun Beverages: With organization development restoring, aided by unlocking as witnessed in Q4CY20, Axis Securities expects the existing momentum to continue. The stock has a target price tag of Rs 1,230, implying a rally of 23 per cent from the level of Rs1,003 apiece.
Relaxo Footwear: Relaxo Footwear has maintained wholesome operating cashflows, asset turns and EBITDA margins more than the years generating it a capital-effective organization, mentioned the brokerage. It has a price tag target of Rs 1,013 apiece, get of 15 per cent.
Camlin Fine Sciences: The brokerage firm sees an upside of 18 per cent in Camlin Fine Sciences stock, with a target price tag of Rs 165. CFS is one of the world’s major and integrated producers of the most preferred classic antioxidants and vanillin and manufactures a variety of other shelf-life options, aroma components and overall performance chemical substances.
Amber Enterprises: Healthy construct-up for the upcoming season, government policy measures and assistance by way of the PLI scheme tends to make us believers in this structural extended term story. It has a target price tag of Rs 3,658, a get of 10 per cent.
Minda Corporation: Minda Corp would be a beneficiary of migration to BS6 as the company’s solution viz., wire harness (25-30% industry share) would witness a sea transform in share of organization each in terms of worth and volume. It will have to have a jump of 20 per cent from the prior close to hit the target of Rs 121 apiece.
Steel Strip Wheels: The rising contribution of higher margin Al-alloy wheel rims in all round revenues to help margin expansion. Steel Strip Wheels had reported about 7 per cent of revenues from Al-alloy wheels in FY20 and expects to take it to 25 per cent plus more than a couple of years. The brokerage firm sees a 25 per cent rally in the stock with a target price tag of Rs 877 apiece.
Lupin: A 20 per cent upside would be required to take it to levels of Rs 1,225 predicted by Axis Securities. The domestic formulations industry in India has recorded 9.5% CAGR in 2014-19 to attain US$ 22 bn is anticipated to develop at 8%-11% CAGR to US$ 31-35 bn by 2040.
Tech Mahindra: Axis Securities believes that Tech Mahindra has a resilient organization structure from a extended term viewpoint. It has advised to ‘buy’ and has assigned 14x P/E numerous to its FY23E earnings of Rs 81, which offers a target price tag of Rs 1,116 per share.
Bharti Airtel: Bharti Airtel reported strong numbers in Q2FY21 beating consensus estimates each on monetary and operating parameters. A jump of 31 per cent will be expected to touch the target price tag of Rs 676.
HCL Technologies: The brokerage firm has offered a target price tag of Rs 1,088 apiece, a jump of 11 per cent. The current deal trend continues to be wholesome for HCL tech and is reflective of traction in Retail & CPG, Manufacturing and BFSI verticals.
ACC Ltd: Stock is at the moment trading at 8.3x CY22E and 7.14x CY23E EV/EBITDA. Axis Securities has advised to ‘buy’ with a target price tag of Rs 2,one hundred a share valuing the organization at 10x of its CY22E EV/EBITDA.
(The stock suggestions in this story are by the respective investigation and brokerage firm. TheSpuzz Online does not bear any duty for their investment assistance. Please seek advice from your investment advisor ahead of investing.)