The brokerage house is betting on names ranging from consumption, retail and paper, among others
Bajaj Finance, Bata India, Havells India, and Sterlite Technologies, among others, feature in Samvat 2075 picks by JM Financial.
The brokerage house is betting on names ranging from consumption, retail and paper, among others.
It highlighted that while the economy and the market have been facing a challenge, marginally improving macros could aid support to the market, going forward.
Here are 10 stocks it is expecting to outperform.
Bata India | Target: Rs 1,060
The brokerage house highlighted the company’s steps to expand footprint across the country, which includes expansion in the online segment as well as an asset-light franchise model.
It plans to add 100 new retail stores, 50 new franchisee stores and expand its distribution in the current year across India. Further, the company has started focusing on products diversification as well as catering to youth, women and kids along with brand extensions in the accessories segment.
Bajaj Finance | Target: Rs 2,750
In the current tight liquidity situation, the brokerage expects Bajaj Finance to gain market share as strong promoter-backed NBFCs will get a disproportionate share of funding going forward.
It also expects less competition from new, small and PE-backed NBFCs.
The brokerage expects earnings CAGR of 31 percent over FY18-21, driven by robust assets under management (AUM) growth and improvement in operational expenditure and credit costs.
SRF | Target: Rs 2,200
It highlighted the company’s plan to expand presence by entering new markets and strengthening presence in the existing ones.
The recovery in agrochemicals business, introduction of newer products and increasing contribution of value-added products could be important factors going forward.
Havells India | Target: Rs 710
The brokerage house expects catalysts for the stock to be gaining market share from unorganised players, aided by GST implementation, strong festive season demand, newer product launches, strong return ratios, and expanding distribution channel network in rural and urban markets.
Among key risks, it sees delayed recovery in macros, the slowdown in consumer discretionary and luxury spending.
Trent | Target: Rs 380
The brokerage house said Trent’s focus is on store rationalisation and rolling out own branded private labels at reasonable prices. It plans to open 25-30 stores in each format in the next few years. Among catalysts, it sees rising income levels in both urban and rural regions, increased consumer spending, accelerated store additions, and improved average bill size.
Sterlite Technologies | Target: Rs 425
Future outlook for the company remains positive, aided by its strong order book of Rs 9,500 crore.
Key catalysts include 4G network expansion and 5G deployment, transforming from a supplier of optical fibres to a data network solutions, management remaining optimistic as good order book gives strong earnings visibility.
Titan Company | Target: Rs 965
Strong traction in the jewellery segment will be positive for the company.
Key catalysts include
(i) New innovative design collection ahead of the upcoming festive season to help drive sales
(ii) Caratlane synergy benefits in jewellery and diamond segments to be positive
(iii) GST implementation to help organised players
(iv) Continued focus on improving product mix and cost control measures to expand margins.
JK Paper | Target: Rs 200
The brokerage is betting on the company's continued effort to increase its market share by growing organically or inorganically over the medium term, which will drive a re-rating for the stock.
Whirlpool | Target: Rs 1,575
The firm highlighted how the company is looking to expand its product portfolio. Further, it also said that it posted above-industry growth rates in FY18, driven by channel expansion, strengthening product portfolio, higher exports and stronger takeoff from e-commerce business.
Cholamandalam Investments | Target: Rs 1,500Cholamandalam remains a top pick among frontline NBFC names with strong parental backing, diversified CV book, strong balance sheet, secular HE business and growing CV market, which will help re-rate the stock.