HDFC Securities’ 4 stock picks over the next two quarters – Mint

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Focusing on the time horizon for the next two quarters, the retail research team at HDFC Securities has picked four stocks for recommendations which are from FMCG, IT consulting and agrochemicals sectors.

Here are HDFC Securities’ stock picks over the next two quarters –

Jyothy Labs: The brokerage said that despite lacklustre performance of the past three years, it believes the company would achieve double-digit revenue growth in the medium term given its various relevant strategic initiatives in recent times. Its core portfolio has been gaining decent traction in the past few quarters with all its major brands having gained market share of 70-180 bps.

”We recommend investors to buy the stock at the CMP of 168 and add on declines to 150-154 band for base case target of Rs. 185 and bull case target of 197 in the next two quarters,’’ it said.

Zensar Tech: HDFC Securities retail research team said that Zensar is amongst the cheaper mid-tier IT Services stock; due to a reason of long term streak of growth underperformance. It thinks that a gradual turnaround in fortunes may be round the corner.

”We believe the base case fair value of the stock is 367 and the bull case fair value of the stock is 397 over the next two quarters. Investors can buy at LTP and add further on dips in the 304-308 band,’’ the brokerage said.

Sharda Cropchem: The brokerage has initiated its coverage on Sharda Cropchem limited. It believes that a strong pipeline of registrations would drive volume and sales growth of the company. Its asset light model, cash rich balance sheet (cash & equivalents of 340cr as on Mar-2021) and focus on registrations in stricter geographies augur well for tapping incremental volume growth, HDFC Securities said.

”We recommend investors to buy the stock at LTP of 359 and add more on declines to 322 for base case target of 395 and bull case target of 424.5 over the next two quarters,” the note said.

PNB: The brokerage said that most of the concerns arising out of pending writeoffs out of restructured/SMA accounts are already in the price. ”We have assumed higher recoveries and lower slippages than the street going forward. NIMs may also start to rise going forward due to lower interest reversals.’’

”We believe that investors can buy PNB at LTP and add more at Rs.36.5 for the base case fair value of Rs.54.8 and for the bull case fair value of Rs.65.8 (0.9xFY23E ABV) over the next two quarters. PNB is a high-risk high reward stock. We have assigned “high risk” rating,’’ it said.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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