Moneycontrol BureauThe fed uncertainty has irked global investors with markets tumbling while India is still enjoying what is called a relief rally. After the US Fed's overnight decision to hold interest rates at record lows fanned worries about the health of the global economy, Indian market is still poised for a good surge feel analysts. The Nifty is likely to head higher in the medium term and a re-test of old highs of around 9,300 could be on the cards, says Sanjay Dutt, Director at Quantum Securities.
Now, domestic investors are eyeing the Reserve Bank of India's monetary policy review on September 29 before Indian market head to Diwali extravaganza. While analysts make the calculations and churn a new portfolio, here is something that can spin some money for you. Motilal Oswal has picked 7 companies which have potential to become Good-to-Great. These stocks made the final cut averaged cumulative stock returns that are 6.9 times the general market over the 15 years following their transition point. Based on disciplined management, goal-oriented target and results, the brokerage feel these seven companies stand out.
The brokerage has set a target price of Rs 360 with a buy rating.Attractiveness:#ITC enjoys an unchallenged monopoly, with 84 percent value share in the organised segment.#ITC’s operating margins likely to expand from 37.4 percent in FY15 to 39.2 percent in FY17.Maruti The brokerage has set a target price of Rs 5290 with a buy rating.Attractiveness:#Market share to increase by 200bp to 48 percent led by 16.5 percent volume CAGR over FY15-18. This coupled with better mix would drive 20 percent revenue CAGR.#EPS CAGR of 42 percent likely over FY15-18.
Larsen and ToubroThe brokerage has set a target price of Rs 2150 with a buy rating.Attractiveness:#Infotech / Tech Services IPO is expected by July 2016. #It is focusing on improving RoE through monetization of mature assets, exiting non-core activities, and fund infusion (including listing of subsidiaries).
Motilal Oswal has set a target price of Rs 1140 with a buy rating. Attractiveness: #Healthy core revenues and productivity gains may enable it to report steady-state return on asset (RoA) of over 2 percent and 30 percent earnings CAGR over FY15-18.#CASA ratio is expected to improve by 500 basis points to 40 percent over FY15-18.
Ultratech The brokerage has set a target price of Rs 3704 with a buy rating.Attractiveness:*Likely to have 18 percent capacity market share by FY18,aiding industry leading volume growth and strong operating leverage.*Cost initiatives and increase in pricing power would drive 7-8pp margin and RoE expansion over FY16-18.
United Spirits The brokerage has set a target price of Rs 4250 with a buy rating.Attractiveness:*EBITDA margin to expand to 12.6 percent by FY17, as initial rounds of cost saving kick in. Build in 20 percent EBITDA margin by 2020.*Expect its market share to remain steady in the Popular segment, but inch up 100-150bps per annum in the prestige+ segment.
Zee Entertainment The brokerage has set a target price of Rs 475 with a buy rating.Attractiveness:*Expect 22 percent CAGR in advertising revenue and 24 percent CAGR in domestic subscription revenue over FY15-18, led by market share gains in a rebounding ad market and increase in broadcasters’ share of subscription revenue.*Expect EBITDA / PAT to double over FY15-18 and EBITDA margin is likely to reach 30 percent by FY18
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