Domestic markets witnessed a stellar journey during Samvat 2077. Despite the pandemic in play and the second wave spreading havoc across the country, the NSE Nifty 50 index recorded its best ever returns in 12 years.
Domestic markets witnessed a stellar journey during Samvat 2077. Despite the pandemic in play and the second wave spreading havoc across the country, the NSE Nifty 50 index recorded its best ever returns in 12 years. Foreign investors continued to buy domestic and large number of retail investors entered the market. Going ahead, fundamental reasons such as pro-growth policies, National Asset monetization pipeline, and strong recovery in real estate are some of the reasons that are keeping investors analysts at ICICI Direct bullish on India’s growth story. The brokerage firm has hand-picked seven stocks that it is advising investors to buy this muhurat trade.
Target price – Rs 2,380
The footwear major is among the muhurat picks given by ICICI Direct. The stock price has soared 29% so far this year to now trade at Rs 2,030 per share. ICICI Direct said that Bata’s focus on cost reduction, omni channel, change in product mix, and calibrated expansion of retail network through asset light franchisee route is expected to be structurally positive. “We believe such strategic initiatives are expected to provide thrust to its operational performance on a sustained basis. We expect revenue, earnings growth of 9%, 17%, respectively, in FY20-24E with 480 bps improvement in RoCE to 33.0% in FY24E,” ICICI Direct said. The target price implies a 17% upside.
Target price – Rs 860
The brand is expected to capture high trajectory growth opportunities in the Indian ethnic wear segment. TCNS Clothing has already emerged as the market leader in women’s ethnic space, according to ICICI Direct. The firm has upped its efforts of setting up integrated warehouse to enhance supply chain. So far this year, the stock has zoomed 74% to now trade at Rs 778 per share. The target price implies 10% upside from current levels.
Target price – Rs 120
The PSU bank is a strong force in the banking business with 8192 branches and 11637 ATMs. ICICI Direct said that Bank of Baroda has better operating metrics among public sector banks. “We believe credit growth will pick up with unlocking and speedy economic recovery. Transfer of NPAs to bad bank would lower broad NPA numbers and aid recovery,” ICICI Direct said. This year Bank of Baroda shares have zoomed 56% to now trade at Rs 100 per share, this implies an upside of 20%.
Target price – Rs 350
Gateway Distriparks is an integrated intermodal logistics facilitator in India. “DFC is expected to normalise its operation (Rewari – Palanpur and up to Pipavav port) in Q3FY22 while Mundra port will take three to four quarters to normalise. This should benefit CTOs like GDL in terms of higher volume growth,” the brokerage firm said. The company has been actively reducing gross debt, which will make the balance sheet stronger. Share price of Gateway Distriparks has more than doubled this year and the target price set implies an upside of 18.6%.
Target price – Rs 325
The real estate arm of Mahindra Group has 27.4 million square feet (msf) of completed, ongoing and forthcoming residential projects across seven cities. “Going ahead, triggers such as PLI schemes, the softening of interest rates and credit availability, the lower tax rates for new manufacturing facilities, coupled with the global realignment of manufacturing, supply chains will drive IC & IC business,” ICICI Direct said. The brokerage firm added that they like Mahindra Lifespace given its strong parentage, the management’s focus on expanding its overall scale of operation and a comfortable balance sheet. The stock has zoomed 132% so far in 2021 and the target price hints at another 15% upside.
Target price – Rs 300
The construction equipment and material handling company commands a strong market share in excess of 60% in the crane market. ACE can benefit from the expected pick up in infrastructure and industrial cycle ahead. The company had managed to sail through the covid period on the back of some increased demand in construction equipment segment. ACE share price has gained 77% in 2021, the target price implies at another 18.5% jump.
Vardhman Special Steel
Target price – Rs 340
Vardhman Special Steel (VSSL) is among India’s leading steel bar producers for automotive applications. Earlier this year the company received an environmental clearance (EC) for expansion of capacity at its existing plant in Ludhiana, to up to 280000 tonnes per annum (TPA) of rolled production. This would increase the current rolling capacity of 200000 TPA to 250000 TPA. “Over FY21-23E, we expect VSSL’s topline to grow at a CAGR of 25%, while EBITDA and PAT are expected to register a CAGR of 35% and 64%, respectively,” ICICI Direct said. In 2021, so far the stock has zoomed 143% and the target price hints at another 24% upside.