Indian equities have been majorly rising for the last two months on the back of better-than-expected Q4 earnings with the benchmark indices Sensex and Nifty growing nearly 10%. Amid the broad rally, many mid-cap to small-cap stocks have advanced more than 25%. We take a look at a small-cap share which has risen more than 35% in the span of last two months outperforming the headline indices. According to a domestic brokerage firm, shares of CMI Ltd may give up to 100% return in the bull case scenario from the current market prices.
The stock of CMI Ltd has already surged 37% to 292.7 from a share price level of Rs 213.3 on NSE. Even today also, the stock of CMI Ltd advanced 5.74% to Rs 309.5 in the early morning deals. The research and brokerage firm Edelweiss Broking Ltd has given a base case target price of Rs 463 which implies a potential upside of 58% from the current market price of Rs 292.7. “We recommend ‘tactical buy’ with target price of Rs 463 per share, valuing the stock at P/E multiple of 12x on FY20E basis,” Edelweiss Broking said in a report.
While, on the other hand, Edelweiss Broking has a bull case target price of Rs 579 which suggests an upside of 98% from the current levels. Valuing the stock at industry average P/E multiple of 15x on FY20E basis, bullish target price could be INR 579, Edelweiss Broking said further. However, Edelweiss had also given a bear case target of Rs 309 per equity share.
Today also, another brokerage firm HDFC Securities has given a buy rating with a target price of Rs 361 implying an upside of 23% from the current level. HDFC Securities has suggested buying the stock current market price and add on dips from Rs 260 to Rs 265. According to HDFC Securities, the target price will be achieved in three to four quarters.
Disclaimer: Views and recommendations given in this section are the brokerage firms’ own and do not represent those of www.financialexpress.com. Please consult your financial adviser before taking any position in the stock/s mentioned.