Houseviews: Four interesting stock buys this season

Here is what brokerages recommend during this earnings season:

Bank of America-Merrill Lynch maintains a Buy on Exide, but it has cut its target to Rs 180.  They have cut their EPS estimate for FY12 by 12% and for FY13 by 5% owing to lower volume and margin. Key drivers of stronger growth will be cyclical recovery in replacement battery sales, expansion of dealer network by 20% and higher capacity.

BofA-ML also recommends buying Hero Honda with a target of Rs 2,025. Earnings were slightly ahead of expectations due to higher financial income and lower taxes. BofA-ML has raised forecasts to factor in variances as well as stronger volume traction.

Citi maintains a Buy on United Spirits with a target of Rs 1277. The price cut in Royal Challenge of 5-15% in Punjab and Haryana has resulted in a volume growth of more than 20% in these markets.

RBS maintains a Buy on Sesa Goa with a target of Rs 360. The company reported muted earnings. While the second quarter is likley to remain weak with volumes impacted by monsoon, earnings should be strong in the second half of FY12.