Securities
INDIAN OIL CORPORATION LTP: Rs 76.5 Target: Rs 100
is likely to benefit the most among its peers from an uptick in refining margin, further supported by robust petchem margin in the near term.
BHARAT FORGE LTP: Rs 879.5 Target: Rs 928
Its forging business is benefitting from China+1 and EU+1 strategy globally. Government’s initiative to enhance local manufacturing through the PLI schemes and mission of Atma Nirbharata is boosting prospects for the company.
LTP: Rs 287.8 Target: Rs 410
Current order book gives the company robust revenue visibility over the next 2-3 years. Government’s plan to expand the national highway network augers well for the company.
LTP: Rs 613.2 Target: Rs 750
Strong loan growth, sharp margin expansion, and asset quality improvement leading to benign credit costs are the key positives. We expect SBI to deliver its target return on assets of 1% and return on equity of 19% by FY24.
LTIMINDTREE LTP: Rs 4,364 Target: Rs 5,450
The risk-reward is attractive at 22 times FY24 estimated earnings and 20% EPS CAGR over FY23-25. The integration process runs as per plan, while the management identifies strategic accounts to cross-sell end-to-end services.
RATEGAIN TRAVEL LTP
: Rs 284.6 Target: Rs 405
The deal pipeline is at an all-time high, and the pace of closures is healthy. New product offerings provide a competitive advantage and operating leverage. We see a 30% revenue CAGR over FY22-25, with Ebitda margins reaching 20% by FY25 amid strong travel demand.
Services
LTP: Rs 890.9 Target: Rs 1,100
ICICI Bank to deliver strong compounding returns with valuations set to re-rate higher as the bank has cemented its stalwart position with highly efficient significant liability franchise, strong capital ratios, and steady asset quality.
AKZO NOBLE LTP: Rs 2,219.6 Target: Rs 3,200
At the current market price, it trades at 29 times its FY23 estimated earnings which is more than a 60% discount to industry leader Asian Paint. We believe the stock will likely re-rate significantly in FY24.
LTP: Rs 1,333.2 Target: Rs 1,750
Store addition trajectory remains ahead of expectations. With Pizza Hut on strong footing, likely bounce back in KFC-India business with non-veg consumption normalising and moderation of infl ationary pressure should yield strong performance.
Kotak Securities
STATE BANK OF INDIA LTP: Rs 613.2 Target: Rs 720
Despite its strong outperformance in the September quarter, valuations are still not expensive. SBI reported a 75% YoY earnings increase in the September quarter, led by operating profits doubling YoY, and its return on equity at 18%.
LTP: Rs 1,379.8 Target: Rs 1,675
Shriram Finance will emerge as the second-largest retail-focused NBFC in India, post-merger of
Fin and Shriram City Union. A new business structure, diversifi edproduct bouquet, and favourable business environment will support growth momentum.
LTP: Rs 123.1 Target: Rs 130
NMDC has announced a sharp 9% price cut for iron ore in its attempt to revive volumes. We see a strong re-rate case for NMDC after the steel plant demerger with improved capital allocation, higher FCF, and likely higher dividend payouts.
Fin
LTP: Rs 933.8 Target: Rs 1,050
Bank has been reporting strong growth in retail and mid-corporate segments, which would be key growth drivers along with MSME. While estimating margins to remain healthy, Axis expects the cost-toassets ratio to moderate at 2% by the end of FY25.
LTP: Rs 510.9 Target: Rs 740
JUBI remains our top pick in this space, given that it has the best balance sheet to fund expansion, its proven track record of managing both store expansion and healthy SSSG, and its technological edge over peers.
ANGEL ONE LTP: Rs 1311.5 Target: Rs 2,200
A perfect play on the fi nancialization/digitization of savings and gross under-penetration of equities in India. Angel, a transformed digital broker, will outperform via its recently launched SuperApp and Diversification strategy.
