stocks to buy: Hot Stocks: What should investors do with Asian Paints, Axis Bank, ITC post Q2 results?

We have collated a list of recommendations from top brokerage firms from ETNow and other sources:

CLSA on Asian Paints: Underperform | Target Rs 3425

CLSA maintained an underperform rating on Asian Paints post the September quarter results with a target price of Rs 3425.

The company is looking to extend its competitive edge. The current valuation asks for healthy growth, but there is margin pressure from a weak sales mix and high-cost inventory, the brokerage said.

The company should focus on back end and future capability, it said. It allocated Rs 6,750 crore CAPEX over the next 3 years, CLSA added.

CLSA on Axis Bank: Buy | Target Rs 1150

CLSA retained its buy rating on Axis Bank with a target price of Rs 1150. The company reported a big turnaround, and it remains our top pick, said the note.

According to the brokerage, the private sector lender recorded a big jump in margins for the quarter ended September, and the current levels could be sustainable.

“Loan growth improved but liability mobilization will be key. The stock deserves a re-rating,” observed CLSA. Axis remains CLSA’s top sectoral pick.

CLSA on ITC: Outperform| Target Rs 375

CLSA maintained an outperform rating on ITC with a target price of Rs 375. Business rebound is heartening, it said. ITC remains our preferred pick in staples, the note added.

“FMCG business sustained healthy momentum. Cigarette revenue grew by 23% YoY/5% QoQ with 19% volume growth,” the brokerage said.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)