Here are 2 top stock picks by HDFC Securities over the next two quarters – Mint

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Domestic brokerage and research firm HDFC Securities recent top stock recommendations come with a focus on time horizon of around two quarters. The brokerage’s two top stock picks with a ‘Buy’ stance come from MFI-NBFC and Auto Ancillaries sectors which are CreditAccess Grameen Limited and NRB Bearings Limited.

HDFC Securities’ top stock picks over the next two quarters:

CreditAccess Grameen: The brokerage said that CreditAccess has proven track record of delivering industry leading growth. Its AUM has grown at CAGR of 45% over FY17-21 (including MMFL). Niche positioning in deeper geographies backed by superior liquidity provides edge over other peers.

It feels that the asset quality will start recovering from H2GF22 onwards with upside risk from Covid third wave. It believes that the stock will keep getting premium valuations due to its niche retail book, industry leading growth and superior return ratios.

“We believe that investors can buy CreditAccess Grameen Ltd at LTP of 682 and add more at 606 for the base case fair value of 749 and for the bull case fair value of 813 over the next two quarters,” HDFC Securities’ note stated.

NRB Bearings: HDFC Securities has initiated coverage on the auto ancillary stock. NRB is gearing up for the ‘next normal’ as new product lines and industry dynamics get redefined. It focuses on component categories that could contribute more to vehicle costs as these provide higher margins, on components which are not likely not be replaced with the advent of electric vehicle (EV) and new products for EV, and plans to expand its portfolio to serve adjacent industries, it said.

HDFC Securities believes investors can buy the stock in the band of 132-134 and add on dips to 116-118 band for a base case fair value of 150 and bull case fair value of 168 over the next 2 quarters.”

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

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