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Godrej Agrovet

The firm has said to “buy” the stock with a 16% upside from the current levels for a target price of Rs 758. The company is a diversified agri player, including significant presence in animal feed. Motilal Oswal sees many positives in buying the stock of Godrej Agrovet.

“Palm oil prices are expected to correct with increasing production from Indonesia and Malaysia. As per FAO, palm oil production globally is expected to increase 3% to 75.45mmt, driven by the expectation of a 6%/3% production jump to 45mmt/19.6mmt in Indonesia/Malaysia.

The Crop Protection business is expected to do well, largely owing to expected product launches in the standalone business (over the next 1-2 years), better performance from Astec Lifesciences owing to its expertise in Triazole chemistry, and the commencement of a new herbicide plant. We expect a 25% revenue CAGR over FY21-23,” the brokerage firm has said.

Godrej Agrovet: 16% returns likely

According to Motilal Oswal, the animal Feed segment is seeing lower demand from Hotels, Restaurants, and Catering (HORECA) due to the second wave and is still operating at lower capacity utilization v/s pre-COVID levels. This has impacted demand for milk, chicken, and eggs. While recovery in the segment has been marginally postponed, it is expected to deliver a better performance v/s FY21 on a low base.

“We expect a 39% revenue CAGR over FY21-23. We value the stock on an SoTP basis to arrive at target price of Rs 758. Maintain Buy,” the brokerage has said.

Shares of Godrej Agrovet were last seen trading at Rs 652, against the target price of Rs 758.

HDFC Bank

Motilal Oswal also has a buy on the stock of HDFC Bank and sees a 20% upside from current levels.

“HDFC Bank continues to deliver better growth trends v/s its peers, led by healthy trends in Wholesale advances. Also, Retail deposit trends remain healthy, while a sharp sequential drop in Wholesale deposits affected deposit growth in 1QFY22. In the near term, lifting of RBI restrictions and new stress formation due to the second COVID wave would be a key monitorable. We maintain our Buy rating with a target price of Rs 1,800 per share (3.5 times FY23E ABV),” the brokerage has said.

The shares of HDFC Bank were last seen trading at Rs 1512 against the current market price of Rs 1,800.

Godrej Consumer Products

Motilal Oswal Institutional Equities sees a 16% upside on the stock of Godrej Consumer Products and has suggested to buy the stock.

The firm sees Sitapati’s appointment as another important piece of the puzzle that unlocks the path to strong earnings growth for GCPL. The other factors attributed to buy the stock includes better capital allocation efforts in recent years, appointment of a new head in the erstwhile significantly underperforming GAUM (largely Africa) business, with good initial results in the first year of his tenure in FY21, and potential tailwind in Soaps and Personal Wash products, led by more frequent usage post COVID-19, and a sharp increase in penetration levels in the Hand Wash category.

“Valuing Godrej Consumer Products at 46 times Jun’23E EPS, we arrive at our price target of Rs 1,070, a 16% upside to its current market price. We maintain our Buy rating,” Motilal Oswal Institutional Equities has said in a report.

Shares of Godrej Consumer products were last trading at Rs 938 on the NSE.

Disclaimer

All of the above stocks are picked from the report of Motilal Oswal Institutional Equities. Investing in stocks are risky and investors should do their own research. The author, the brokerage firm or Greynium Information Technologies Pvt Ltd is not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise due caution as markets have run-up significantly.

Axis Bluechip Fund

Axis Bluechip Fund invests in equity and equity related instruments of large cap companies. The fund has been rated 5-star by Morningstar and Value Research.

The net asset value under the growth plan is Rs 42.42, a level at which new investors would have to invest. An SIP is also possible as investment, which could be done with a minimum investment of Rs 500. If you are looking to invest in bulk in the Axis Bluechip Fund, it is not desirable as the Sensex at 52,500 points is at near peak. So, staggered investment in Axis Bluechip or another mutual fund scheme would be the right way to go about investing.

The fund has returned investors about 44.78% in the last one year, while the 5-year returns are 16.37%.

UTI Flexi Cap Fund

UTI Flexi Cap Fund generates long term capital appreciation by investing in equity and equity related securities of companies across market capitalizations. The fund has been rated 5-star by Crisil and Value Research.

This fund has seen phenomenal returns of nearly 68% in the last 1-year. The AUM is sizeable at more than 18,000 crores. The biggest advantage of flexi cap funds is the fund manager can freely switch from large caps to mid and small caps and vice vesa.

For those investors, who have a time horizon of 5 to 7 years, this investment could be a good bet. An SIP UTI Flexi Cap Fund is also possible with a sum of Rs 500 each month. The net asset value of the fund is Rs 234.39 under the growth plan.

ICICI Prudential Bond Fund

If as an investor, you are looking for a steady stream of income go for this debt fund, which is rated as 5-star by Morningstar and has a 4-star from Value Research.

The scheme seeks to generate income through investments in a range of debt and money market instruments while maintaining the optimum balance of yield, safety and liquidity.

In line with falling interest rates, this ICICI Prudential Bond Fund has generated 4.5% returns in the 1-year for investors, while the 3-year returns has been close to 9% and the 5-year returns has been 7.87%. Most of the investment is either in state government issued securities or Government of India issued securities.

Mirae Asset Tax Saver Fund

This fund allows you to save tax under SEC80C of the Income Tax, subject to a ceiling of Rs 1.5 lakhs every financial year. This basically allows you a tax savings as well as capital appreciation by investing your money in equity related instruments.

Mirae Asset Tax Saver Fund has been rated 5-star by Value Research and Morningstar. The fund has given investors a return of a whopping 65.58% in the last 1-year. The assets under management of the fund is nearly 8,000 crores. Investors can look to invest through te SIP route as well in the fund.

Mirae Asset Tax Saver Fund has invested in stocks like HDFC Bank, ICICI Bank, Infosys, Axis Bank and TCS. For those looking to save tax and at the same time generate returns by investing for the long-term, this scheme is a good to invest.

Axis Small Cap Fund

This is a fund that is suitable only for investors who are willing to take the risk. This is because returns from small cap stocks are very volatile and they tend to fall faster than the markets, so to that extent the risk remains. Similarly, they are capable of giving far superior returns as well, when compared to the indices.

Axis Small Cap Fund has been rated 5-star by CRISIL and Value Research. The fund has investments in the stocks of Galaxy Surfactants, Tata Elxi, JK Lakshmi Cement, Narayana Hrudayalaya etc.

Since this is a small cap fund, we would suggest investors to look at SIPs, which would help you hedge your risk, in case of a severe market downturn.

Nippon India Gilt Securities Fund

This investment is for investors looking for absolutely safety, since the money is invested in state government or central government securities. The fund is rated as “5 star” by Morningstar. There is not much to say here as the capital is safe and returns would be low, as interest rates are low.

Nippon India Gilt Securities Fund has heavily invested in government securities.

ICICI Prudential All Seasons Bond Fund

The difference between ICICI Prudential All Seasons Bond Fund and the Gilt Securities Fund mentioned above, is that Gilt Funds park money exclusively in government securities, while bond funds also invest in corporate instruments like non convertible debentures or bonds.

This bond fund has been rated as 5-star by Value Research. The three year returns from the fund has been 8.54%, while the 5-year returns have been closer to the 8% mark. If you are looking for safety and returns, these bonds funds maybe a good bet.

Disclaimer

Investing in mutual funds is risky and investors should understand the risk. Greynium Information Technologies and the author do not take any responsibility for losses incurred based on the decisions in the article. The article is meant for informational purposes only.

HCL Technologies

The stock gets a ‘add’ rating from the brokerage. It feels that the stock’s solid pipeline provides growth comfort and forecasts profits growth of 6.6 percent in FY22E and 11 percent in FY23E.

The firm has given a Target of Rs 1,080 with an upside of 9.8%.

The recent deal trend for HCL Technologies has been positive, reflecting growth in the Retail and CPG, Manufacturing, and BFSI industries. Fiskars will be able to standardise and harmonise their IT and business processes, promote operating model change, and improve overall digital maturity with the help of HCL.

HCL Tech. has a Return on Assets ROA of 20.65%, which is a positive indicator of future performance. (It’s always preferable to have higher values). HCL Tech’s current year dividend is Rs 8, with a yield of 1.23 percent.

ICICI Bank

The stock has a ‘buy’ call from the brokerage. The lender has been checking all the right boxes and producing solid growth in a hard environment, according to the brokerage. The lender is expected to recover from the COVID-19 incident faster than its peers, according to the report. The firm has set a target price of Rs. 710 for the stock, representing a 12.5 percent gain.

In the most recent financial year, ICICI Bank generated Rs 74,798.32 crore in revenue. In the last three years, it has grown its income by 11.36 percent.

Non-interest income, often known as other income, is critical for banks since it provides a consistent source of revenue with no added risk. ICICI Bank’s other income has increased to Rs 16,448.62 crore. Since the last three years, the corporation has continuously maintained a NIM of 3.08 percent.

LIC Housing Finance

On the stock, the brokerage has a ‘add’ call. During FY22-24E, it anticipates the company to generate a 15% EPC CAGR and a RoE of 13-14 percent. The firm has set a target price of Rs. 600 for the stock, upside of a 27.7 percent gain. The company’s advances growth ratio is 15.37 percent, which is well-maintained. The company’s net profit is Rs 2,401.84 crore, with a compounded profit growth rate of 7.54 percent over the last three years. LIC Housing Finance has a PAT margin of 12.19 percent. The stock now has a P/E ratio of 4.94, with an average historical P/E of 12.10 over the last five years.

Sun Pharma

The brokerage has an ‘add’ recommendation on the company and has raised its FY22-23E estimates by 4-5 percent due to lower marketing spend. The company achieved solid domestic business growth of 13% year over year, with Ilumya ramp-up on track, it said. According to the brokerage, continued specialist execution affords the possibility for additional re-rating and will create high profits growth. The firm has set a target price of Rs. 740 for the stock, upside of a 10 percent gain.

For the past three years, the company has showed a good profit growth of 422.44%. The firm has a high level of operating leverage, with an average operating leverage of 9.35. The debt-to-equity ratio of Sun Pharma Inds. is 0.26, which is a good sign for the company.

NCC

The stock has a ‘buy’ call from the brokerage. A high order backlog, it continued, provides good revenue growth visibility for the next 2-3 years. Based on a positive view for infra capex, it is bullish about future order inflows. The firm has set a target price of Rs. 105 for the stock, upside of a 20.7 percent gain. For the past three years, the company has showed a solid profit growth of 19.21%. NCC has a PE ratio of 21.19, which is excessive and expensive in comparison. The D/E ratio of NCC is 0.37, indicating that the company has a low debt-to-capital ratio. NCC’s current year dividend is Rs 0.20, with a yield of 0.89 percent.

SAIL

The stock has a ‘buy’ call from the brokerage. SAIL is well-positioned to benefit from a strong steel up-cycle, according to the report, with expansion projects driving volume growth and operating leverage. The brokerage also claimed that the balance sheet has greatly improved and that deleveraging should continue. For the past three years, the company has showed a good profit growth of 39.48 percent. The company has a high operating leverage, with an average operating leverage of 6.40. SAIL has a PE ratio of 13.48, which is low and undervalued in comparison.

6 Top Stock Picks To Buy For The Month Of July From Kotak Securities

Disclaimer

All of the stocks mentioned here were chosen from a Kotak Securities report. Stock investing is risky, and investors should conduct their own research. Any losses experienced as a result of a choice based on the above article are not the responsibility of the author, the brokerage business, or Greynium Information Technologies Pvt Ltd. As a result, investors should proceed with care, a markets have risen dramatically.