The BSE Sensex was trading 259.29 points lower at 60,347.27 in the early trade on Tuesday amid sell-off in equities. It opened 174 points up at 60,786.07 but soon after, pared gains and fell into the negative territory to 60,347.27 points. The NSE Nifty was also down by about 57 notches to 17,995.95 points. Here’re some of the stocks that investors should watch out for, as per brokerage Angel One:
Ashok Leyland
Rating: Buy
CMP: Rs 121 | Target: Rs 164 | Upside: 36%
Ashok Leyland Ltd (ALL) is one of the leading players in the Indian CV industry with a 32 per cent market share in the MHCV segment. The company also has a strong presence in the fast-growing LCV segment. The company is well placed to capture the growth revival in the CV segment and will be the biggest beneficiary of the government’s voluntary scrappage policy and hence rate the stock a buy.
Federal Bank
Rating: Buy
CMP: Rs 103 | Target: Rs 135 | Upside: 32%
Federal bank is one of India’s largest old generation private sector banks with total assets of Rs 1.9 lakh crore with deposits of Rs 1.56 lakh crore and a loan book of Rs 1.2 lakh crore in FY21. PCR at the end of Q3FY21 stood at about 67 per cent, which is adequate. The restructuring book is expected to be at Rs 1,500-1,600 crore, out of which Rs 1,067 crores has already been restructured. This is against earlier expectations of a total restructuring of Rs 3,000-3,500 crore.
Suprajit Enggineering Ltd
Rating: Buy
CMP: Rs 373 | Target: Rs 485 | Upside: 30%
It is the largest supplier of automotive cables to the domestic OEMs with a presence across both 2Ws and passenger vehicles (PVs). SEL has outperformed the Indian auto industry in recent years (posting positive growth vs low double-digit declines for the domestic 2W and PV industry in FY21). SEL is a prime beneficiary of a ramp-up in production by OEMs across the globe and is well insulated from the threat of EV (is developing new products). Its premium valuations are justified, owing to its strong outlook and top-grade quality of earnings.
Stove Kraft
Rating: Buy
CMP: Rs 658 | Target: Rs 1,050 | Upside: 60%
AU Small Finance
Rating: Buy
CMP: Rs 1,309 | Target: Rs 1,520 | Upside: 16%
It is one of the leading small finance banks with an assets under management of of about Rs 34,688 crore at the end of Q1FY22. AU SFB has a well-diversified geographical presence across the north, central, and western India. Given its stable asset quality, loan growth is expected to pick up in Q2FY22, which should lead to a re-rating for the bank.
HDFC Bank
CMP: Rs 1,656 | Target: Rs 1,859 | Upside: 12%
Rating: Accumulate
It is India’s largest private sector bank with an asset book of Rs 11.3 lakh crore in FY21 and a deposit base of Rs 13.4 lakh crore. The bank has a well spread out book with wholesale constituting about 54 per cent of the asset book while retail accounted for the remaining 46 per cent of the loan book. Given best-in-class asset quality and expected rebound in growth from Q2FY22, it is a good pick given reasonable valuations at 3.0xFY23 adjusted book, which is at a discount to historical averages. After the announcement of HDFC’s merger with HDFC Bank, its share increased by about 10 per cent.
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