VALUEGUIDE APRIL 2021 - SHAREKHAN
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ValueGuide
April 2021
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CONTENTS
From the Editor’s Desk EQUITY
As it bid goodbye to FY2021, FUNDAMENTALS
the rally of Indian equities 3R Stock Idea 09 REGULAR FEATURES
took a halt in March, as Stock Update 11 Report Card 04
it faced the onslaught of
Sector Update 23 Earnings Guide 35
the second wave of the
Coronavirus pandemic.
What added to the trouble
was the volatile movement TECHNICALS DERIVATIVES
in bond yields.... 08 Nifty 25 View 26
PMS DESK CURRENCY
Prime Picks Strategy 28
Star Model Portfolio 29 TECHNICALS
Power Model Portfolio 30 USD-INR 27 GBP-INR 27
EUR-INR 27 JPY-INR 27
MUTUAL FUND DESK 31
Registered Office: Sharekhan Limited, 10th Floor, Beta Building, Lodha iThink Techno Campus, Off. JVLR, Opp. Kanjurmarg
Railway Station, Kanjurmarg (East), Mumbai – 400042, Maharashtra. Tel: 022 - 61150000. Sharekhan Ltd.: SEBI Regn. Nos.: BSE
/ NSE / MSEI (CASH / F&O / CD) / MCX - Commodity: INZ000171337; DP: NSDL/CDSL-IN-DP-365-2018; PMS: INP000005786;
Mutual Fund: ARN 20669; Research Analyst: INH000006183; Disclaimer: Client should read the Risk Disclosure Document issued by SEBI
& relevant exchanges and the T&C on www.sharekhan.com; Investment in securities market are subject to market risks, read all the related
documents carefully before investing.
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APRIL 2021 33
Compliance Officer: Mr. Joby John Meledan; Tel: 022-61150000; email id: compliance@sharekhan.com; Sharekhan ValueGuide
For any queries or grievances kindly email igc@sharekhan.com or contact: myaccount@sharekhan.com
REPORT CARD EQUITY FUNDAMENTALS
STOCK IDEAS STANDING (AS ON APRIL 05, 2021)
CURRENT PRICE AS ON PRICE 52 WEEK ABSOLUTE PERFORMANCE RELATIVE TO SENSEX
COMPANY
RECO 05-APR-2021 TARGET HIGH LOW 1M 3M 6M 12M 1M 3M 6M 12M
Autos
Alicon Castalloy Buy 418 500 519 180 -8.5 11.1 27.6 120.1 -6.2 8.9 2.7 34.6
Amara Raja Batteries Buy 848 1146 1025 469 -5.0 -13.4 14.3 69.3 -2.6 -15.2 -8.0 3.6
Apollo Tyres Buy 221 290 261 80 -8.7 18.7 63.6 165.2 -6.4 16.3 31.7 62.2
Ashok Leyland Buy 113 151 139 37 -10.2 7.9 48.8 184.6 -7.9 5.8 19.8 74.0
Bajaj Auto Buy 3600 4589 4361 2074 -6.6 3.9 21.1 58.0 -4.2 1.8 -2.5 -3.4
Balkrishna Industries Hold 1652 1800 1885 792 3.2 -1.3 15.1 100.6 5.8 -3.3 -7.3 22.7
Bosch Buy 14031 18156 16900 8871 -5.8 5.5 5.5 51.5 -3.5 3.4 -15.1 -7.3
Exide Industries Buy 183 229 221 130 -10.5 -5.7 11.3 30.5 -8.2 -7.6 -10.4 -20.2
Gabriel India Buy 103 160 135 59 -18.7 -10.2 -3.0 95.8 -16.6 -12.0 -21.9 19.8
GNA Axles Buy 361 490 430 135 -8.5 21.4 56.2 162.1 -6.1 19.0 25.7 60.3
Greaves Cotton Buy 128 170 158 66 -10.1 32.2 69.4 91.3 -7.8 29.6 36.4 17.0
Hero MotoCorp Buy 2876 4030 3629 1602 -16.9 -6.7 -8.4 62.4 -14.8 -8.6 -26.2 -0.7
Lumax Auto Technologies Buy 157 190 172 52 -1.5 16.9 55.0 189.0 1.0 14.6 24.8 76.7
M&M Buy 774 1000 952 291 -7.8 5.2 23.5 140.9 -5.5 3.0 -0.6 47.3
Maruti Suzuki Buy 6768 9000 8400 4101 -6.6 -11.3 -1.8 48.8 -4.2 -13.1 -20.9 -9.0
Mayur Uniquoters Buy 405 500 479 138 -2.2 29.0 49.8 164.0 0.3 26.4 20.6 61.4
Schaeffler India Buy 5346 5900 5550 3044 2.8 16.4 46.9 51.4 5.4 14.1 18.3 -7.4
Sundram Fasteners Buy 758 850 839 250 6.8 40.3 77.9 201.6 9.5 37.5 43.2 84.5
Suprajit Engineering Buy 284 329 310 107 0.8 29.9 39.0 128.0 3.4 27.3 11.9 39.4
Tata Motors Buy 305 365 357 65 -6.2 56.2 110.6 352.9 -3.8 53.0 69.5 177.0
TVS Motor Buy 584 688 660 240 -5.6 19.7 24.1 119.9 -3.3 17.3 -0.1 34.5
BSE Auto Index 21998 25073 11627 -7.3 3.7 20.8 95.6 -5.0 1.6 -2.7 19.7
Agri/Specialy Chemical
Aarti Industries Buy 1330 ** 1399 800 5.6 2.9 31.2 60.0 8.3 0.9 5.6 -2.1
Atul Limited Buy 7508 9600 7592 3882 12.4 14.2 23.3 91.0 15.3 11.9 -0.8 16.8
Coromandel International Buy 739 1000 880 497 -5.8 -9.4 -1.5 46.0 -3.5 -11.2 -20.7 -10.7
Insecticides (India) Buy 470 590 557 298 3.6 0.1 -1.8 51.6 6.2 -1.9 -21.0 -7.3
PI Industries Buy 2213 2740 2544 1185 -2.1 -0.7 8.2 68.1 0.4 -2.6 -12.9 2.8
New Ide
Sumitomo Chemical India a
Buy 282 350 338 204 -3.4 -11.6 -3.6 36.6 -1.0 -13.3 -22.4 -16.5
SRF Limited Buy 5642 6760 6161 2710 0.2 -1.2 36.8 95.5 2.8 -3.1 10.2 19.6
Sudarshan Chemicals Buy 516 615 600 354 -6.1 6.3 10.3 39.5 -3.7 4.2 -11.2 -14.7
UPL Buy 646 720 669 306 9.2 36.8 26.8 99.6 11.9 34.1 2.1 22.1
Vinati Organics Buy 1388 1750 1527 751 -1.5 4.9 6.9 75.5 1.0 2.8 -13.9 7.3
Banks and Financial Services
AU Small Finance Bank Buy 1229 1500 1356 366 -2.9 38.4 67.5 156.5 -0.4 35.6 34.9 56.9
Axis Bank Buy 686 900 800 333 -6.3 4.7 52.5 76.3 -3.9 2.6 22.8 7.8
Bajaj Finance Buy 4964 6000 5922 1783 -8.8 -1.3 42.9 120.3 -6.5 -3.3 15.0 34.7
Bajaj Finserv Buy 9489 10860 10586 3986 -4.7 8.0 58.4 101.3 -2.2 5.9 27.5 23.1
Bank of Baroda Hold 73 75 100 36 -10.0 10.8 72.5 50.8 -7.8 8.5 38.9 -7.7
Bank of India Hold 67 ** 101 31 -12.6 31.1 66.5 104.1 -10.4 28.5 34.0 24.8
Cholamandalam Investment
Buy 544 580 579 117 3.3 24.9 108.7 316.3 5.9 22.4 68.0 154.6
and Finance Company
City Union Bank Buy 156 225 200 110 -9.8 -14.5 8.2 36.0 -7.5 -16.2 -12.9 -16.8
Federal Bank Buy 76 95 92 37 -12.4 5.2 47.9 78.8 -10.2 3.1 19.0 9.4
HDFC Buy 2446 3100 2895 1486 -3.8 -7.2 26.4 57.3 -1.4 -9.1 1.8 -3.8
HDFC Bank Buy 1449 1810 1650 826 -5.3 2.0 26.6 61.7 -2.9 0.0 1.9 -1.1
ICICI Bank Buy 571 770 679 286 -6.3 4.5 50.1 75.1 -3.9 2.4 20.9 7.1
Indusind Bank Buy 937 1340 1119 330 -9.8 1.6 50.6 144.1 -7.6 -0.4 21.2 49.3
Kotak Mahindra Bank Buy 1760 2130 2049 1108 -8.5 -10.7 31.5 47.0 -6.2 -12.5 5.8 -10.1
LIC Housing Finance Buy 418 610 488 210 -4.1 2.5 44.7 93.8 -1.7 0.5 16.5 18.5
LT FINANCE HOLDING Buy 95 118 113 46 -10.5 -7.3 48.2 77.1 -8.2 -9.2 19.3 8.3
Max Financial Buy 868 1000 978 329 -5.4 22.5 39.8 142.0 -3.0 20.0 12.6 48.0
New Ide
M&M Financial Services a
Buy 195 260 224 76 -3.9 3.6 48.9 37.5 -1.5 1.5 19.8 -15.9
APRIL 2021 4 Sharekhan ValueGuideEQUITY FUNDAMENTALS REPORT CARD
STOCK IDEAS STANDING (AS ON APRIL 05, 2021)
CURRENT PRICE AS ON PRICE 52 WEEK ABSOLUTE PERFORMANCE RELATIVE TO SENSEX
COMPANY
RECO 05-APR-2021 TARGET HIGH LOW 1M 3M 6M 12M 1M 3M 6M 12M
Nippon Life India AMC Buy 336 418 375 210 -4.8 9.7 22.0 24.9 -2.4 7.5 -1.8 -23.6
Punjab National Bank Hold 37 42 46 26 -11.4 5.0 30.3 23.4 -9.1 2.9 4.9 -24.5
RBL Bank Buy 206 240 274 102 -14.9 -21.9 14.1 77.6 -12.7 -23.5 -8.1 8.6
Repco Home Finance Buy 323 400 377 91 -4.4 34.8 78.4 192.5 -2.0 32.1 43.6 78.9
SBI Buy 354 460 426 150 -7.9 24.1 84.6 89.8 -5.5 21.6 48.6 16.1
Spandana Buy 611 850 830 404 -0.1 -19.8 4.2 3.1 2.4 -21.4 -16.1 -36.9
BSE Bank Index 36913 42655 19676 -7.0 1.4 42.2 68.8 -4.6 -0.6 14.5 3.2
Insurance
HDFC Life Buy 682 850 746 434 -4.9 -5.1 17.0 45.0 -2.5 -7.0 -5.8 -11.3
ICICI Pru Life Buy 437 584 538 317 -9.6 -14.3 1.5 22.3 -7.3 -16.1 -18.3 -25.2
ICICI Lombard Buy 1410 1750 1625 1056 -5.8 -12.3 14.1 21.8 -3.4 -14.0 -8.1 -25.5
Consumer Goods
Asian Paints Buy 2511 3000 2871 1483 5.2 -10.4 20.1 54.6 7.9 -12.2 -3.3 -5.5
Bajaj Consumer Care Buy 271 340 298 129 9.6 20.7 48.9 95.7 12.3 18.3 19.8 19.7
Britannia Buy 3701 4200 4015 2640 5.9 4.6 -1.8 30.6 8.5 2.5 -20.9 -20.1
Colgate-Palmolive (India) Buy 1557 1850 1676 1257 -4.6 -2.5 9.1 18.1 -2.2 -4.5 -12.2 -27.7
Dabur India Buy 537 605 552 421 2.3 0.6 2.0 12.2 4.9 -1.4 -17.9 -31.4
Emami Buy 499 570 520 169 5.9 10.8 43.2 140.6 8.6 8.6 15.2 47.1
Godrej Consumer Products Buy 722 850 808 484 4.4 -3.1 -2.5 29.2 7.1 -5.0 -21.5 -21.0
Hindustan Unilever Buy 2373 2790 2614 1902 7.8 -1.8 12.2 -2.9 10.5 -3.8 -9.6 -40.6
ITC Buy 213 265 239 157 1.8 3.5 25.1 17.1 4.4 1.4 0.7 -28.4
Jyothy Laboratories Buy 143 188 166 94 -3.4 -3.1 -1.2 48.8 -1.0 -5.1 -20.5 -9.0
Marico Buy 403 477 439 267 0.3 -3.7 9.3 42.0 2.9 -5.6 -12.0 -13.1
Nestle India Buy 16909 19055 18821 15104 0.8 -8.7 6.5 -0.7 3.4 -10.5 -14.3 -39.2
Tata Consumer Products Ltd Buy 645 740 679 271 3.6 6.6 27.5 126.5 6.2 4.4 2.6 38.5
Zydus Wellness Buy 2010 2300 2218 1185 6.5 -3.7 9.9 52.6 9.2 -5.6 -11.5 -6.6
BSE FMCG Index 12684 12994 9806 3.0 0.2 13.9 17.4 5.6 -1.8 -8.3 -28.2
IT / IT services
Birlasoft Buy 270 320 284 60 15.8 4.2 32.1 339.9 18.7 2.1 6.4 169.0
HCL Technologies Buy 1033 1250 1074 426 9.8 5.7 24.7 128.7 12.6 3.6 0.4 39.9
Infosys Buy 1410 1650 1426 604 7.2 10.0 33.6 120.0 9.9 7.8 7.5 34.5
New Ide
Intellect Design a
Buy 711 ** 774 62 54.5 119.3 185.5 1,023.9 58.4 114.9 129.8 587.4
L&T Infotech Buy 4268 4800 4500 1338 11.0 8.0 58.8 212.0 13.8 5.9 27.8 90.8
L&T Technology services Buy 2758 3100 2858 1066 5.0 10.5 70.9 149.7 7.7 8.3 37.6 52.7
Mastek Limited Buy 1313 1400 1460 175 8.1 -3.8 44.3 601.9 10.9 -5.7 16.2 329.3
Persistent Systems Buy 1961 2200 1990 460 16.4 27.2 51.1 285.9 19.4 24.6 21.7 136.0
Tata Consultancy Services Buy 3239 3590 3345 1678 7.7 6.1 19.3 82.5 10.5 4.0 -4.0 11.6
Tata Elxsi Buy 2855 3100 3050 606 5.1 43.1 105.1 348.0 7.8 40.2 65.1 174.0
Tech Mahindra Buy 997 1150 1081 490 3.9 0.1 17.7 82.5 6.6 -1.9 -5.2 11.6
Wipro Buy 426 510 467 174 1.2 4.7 28.9 121.7 3.8 2.6 3.8 35.6
BSE IT Index 27294 28159 12224 7.3 8.4 29.4 114.6 10.0 6.2 4.2 31.3
Telecom and New Media
Affle (India) Limited Buy 5426 6580 6287 960 -7.4 37.4 98.3 429.1 -5.1 34.7 59.7 223.6
Bharti Airtel Buy 528 750 623 394 -0.8 0.5 23.8 12.4 1.7 -1.5 -0.4 -31.3
Info Edge (India) Buy 4436 6100 5876 2049 -10.3 -15.7 28.1 89.6 -8.0 -17.3 3.1 16.0
Capital goods / Power
Amber Technologies Buy 3219 3716 3668 922 -6.7 22.4 57.0 170.6 -4.3 20.0 26.4 65.5
Bharat Electronics Buy 131 190 155 58 -10.6 -1.3 37.2 90.4 -8.3 -3.3 10.4 16.5
New Ide
Blue Star a
Buy 925 1200 1025 452 -1.3 13.9 48.8 100.9 1.2 11.6 19.8 22.9
Carborundum Universal Buy 492 611 571 203 -2.1 21.8 84.9 122.4 0.4 19.3 48.9 36.0
CESC Buy 601 825 730 433 -4.9 -3.5 -3.3 33.5 -2.5 -5.4 -22.1 -18.3
Coal India Buy 130 160 163 110 -14.0 -3.9 11.2 -7.5 -11.9 -5.8 -10.5 -43.4
Cummins India Buy 883 1030 933 282 3.4 44.4 95.4 206.4 6.1 41.5 57.3 87.4
APRIL 2021 5 Sharekhan ValueGuideREPORT CARD EQUITY FUNDAMENTALS
STOCK IDEAS STANDING (AS ON APRIL 05, 2021)
CURRENT PRICE AS ON PRICE 52 WEEK ABSOLUTE PERFORMANCE RELATIVE TO SENSEX
COMPANY
RECO 05-APR-2021 TARGET HIGH LOW 1M 3M 6M 12M 1M 3M 6M 12M
Dixon Technologies Buy 3497 3750 4588 700 -81.7 -75.8 -59.9 -6.6 -81.3 -76.3 -67.7 -42.9
Finolex Cable Buy 379 475 426 192 -5.6 3.0 32.9 68.2 -3.2 0.9 7.0 2.9
Honeywell Automation Buy 45261 56265 49805 25000 -3.5 19.6 40.4 72.6 -1.1 17.2 13.0 5.6
Kalpataru Power Transmission Buy 378 485 406 172 -4.1 15.5 56.8 112.1 -1.7 13.2 26.2 29.7
KEC International Buy 414 505 486 155 -10.0 11.7 21.1 161.7 -7.7 9.5 -2.5 60.1
KEI Industries Buy 509 645 563 249 3.0 6.1 46.2 64.2 5.6 4.0 17.7 0.4
NTPC Buy 106 140 115 78 -2.4 8.4 26.1 30.1 0.0 6.3 1.5 -20.4
Polycab India Buy 1373 1530 1444 624 1.6 16.7 65.9 78.7 4.2 14.3 33.6 9.3
Power Grid Corporation Buy 214 245 239 153 -2.8 9.2 31.3 35.6 -0.3 7.0 5.7 -17.1
Ratnamani Metals and Tubes Buy 2018 ** 2100 790 4.5 27.5 61.4 118.7 7.1 24.9 30.0 33.8
Thermax Hold 1292 1350 1464 685 -7.3 34.2 79.5 77.7 -5.0 31.5 44.5 8.7
Triveni Turbine Buy 100 105 118 56 -7.1 18.9 39.7 74.9 -4.7 16.5 12.5 7.0
V-Guard Industries Buy 250 311 262 156 11.0 22.1 49.8 58.4 13.8 19.6 20.6 -3.1
BSE Power Index 2543 2594 1389 1.1 19.5 53.4 85.2 3.6 17.1 23.5 13.3
BSE Capital Goods Index 21028 22776 10916 -3.9 8.4 52.0 92.6 -1.5 6.2 22.4 17.8
Infrastructure
Ashoka Buildcon Buy 97 125 119 38 -14.9 2.9 46.9 147.8 -12.8 0.8 18.2 51.5
JMC Projects Buy 82 95 94 32 4.7 19.8 61.8 142.1 7.4 17.4 30.3 48.1
KNR Constructions Buy 208 270 242 89 -2.6 -38.1 -18.9 16.0 -0.1 -39.3 -34.7 -29.1
Larsen & Toubro Buy 1404 1795 1593 791 -4.1 6.8 57.2 75.1 -1.7 4.7 26.6 7.1
PNC Infratech Buy 257 300 291 94 -4.4 46.8 55.5 171.2 -2.0 43.8 25.2 65.9
Sadbhav Engineering Buy 63 100 85 23 -12.7 -0.6 12.8 156.3 -10.5 -2.6 -9.2 56.8
CNX Infra Index 4093 4316 2476 -3.6 9.8 32.2 67.5 -1.1 7.6 6.4 2.4
BSE Real estate Index 2581 2910 1259 -9.3 2.5 47.6 83.9 -7.0 0.4 18.8 12.5
Metal & mining
JSW Steel Buy 518 ** 541 146 27.3 28.8 77.8 227.0 30.5 26.2 43.1 100.0
NMDC Buy 141 165 144 70 5.9 14.4 69.8 78.6 8.6 12.1 36.7 9.3
MOIL Buy 151 170 178 100 -5.5 -0.5 7.8 43.4 -3.1 -2.5 -13.2 -12.3
Oil & gas
Bharat Petroleum Corporation Buy 428 520 482 292 -7.2 10.5 21.6 21.7 -4.9 8.3 -2.1 -25.5
GAIL (India) Buy 135 175 158 79 -8.3 0.8 53.8 59.7 -6.0 -1.2 23.8 -2.3
Gujarat Gas Buy 548 630 568 225 3.1 42.1 76.5 137.4 5.7 39.2 42.1 45.2
Gujarat State Petronet Limited Buy 270 300 311 178 -6.2 26.5 35.7 46.7 -3.8 24.0 9.2 -10.3
Hindustan Petroleum
Buy 235 275 259 163 -3.3 6.4 35.3 17.4 -0.8 4.3 8.9 -28.2
Corporation
Indian Oil Corporation Buy 91 115 105 71 -10.6 -3.6 20.4 9.3 -8.3 -5.5 -3.1 -33.2
Indraprastha Gas Limited Buy 505 650 595 364 -3.4 -6.9 29.6 15.9 -0.9 -8.8 4.3 -29.1
Mahanagar Gas Buy 1135 1450 1257 780 -6.9 0.5 32.4 32.0 -4.5 -1.5 6.6 -19.3
Oil India Ltd Hold 122 130 139 75 -4.0 8.2 41.7 36.7 -1.5 6.0 14.1 -16.4
Petronet LNG Buy 227 300 280 196 -9.8 -11.2 1.5 13.6 -7.5 -13.0 -18.3 -30.5
Reliance Ind Buy 1993 2400 2369 1091 -8.5 4.1 -9.8 65.2 -6.2 2.0 -27.4 1.0
BSE Oil and gas Index 14804 16588 10689 -8.0 2.6 21.1 37.8 -5.7 0.6 -2.5 -15.7
Pharmaceuticals
Abbott India Buy 15153 19425 18569 13970 2.7 -2.6 -5.1 -9.4 5.3 -4.6 -23.6 -44.6
Aurobindo Pharma Buy 882 1100 1023 394 2.3 -8.9 5.5 98.0 4.9 -10.8 -15.1 21.1
Biocon Buy 406 470 488 298 3.1 -11.7 -11.2 27.8 5.7 -13.4 -28.5 -21.9
Cadila Healthcare Buy 440 560 509 290 -0.5 -8.7 5.9 40.8 2.0 -10.5 -14.7 -13.9
Cipla Buy 819 950 879 452 1.7 -0.7 5.0 66.6 4.3 -2.7 -15.5 1.9
Divi's Labs Buy 3615 4500 3913 1924 3.4 -6.8 14.3 75.1 6.0 -8.6 -8.0 7.1
DR Reddy's Buy 4556 6500 5515 3200 1.5 -13.9 -11.3 27.2 4.1 -15.6 -28.6 -22.2
New Ide
Gland Pharma a
Buy 2501 3040 2784 1701 -2.0 3.8 - - 0.5 1.7 - -
Granules Buy 310 475 438 146 -11.1 -13.3 -18.9 98.8 -8.8 -15.0 -34.7 21.6
IPCA Lab Buy 1875 2560 2456 1443 -2.6 -12.8 -12.3 23.0 -0.1 -14.6 -29.4 -24.8
APRIL 2021 6 Sharekhan ValueGuideEQUITY FUNDAMENTALS REPORT CARD
STOCK IDEAS STANDING (AS ON APRIL 05, 2021)
CURRENT PRICE AS ON PRICE 52 WEEK ABSOLUTE PERFORMANCE RELATIVE TO SENSEX
COMPANY
RECO 05-APR-2021 TARGET HIGH LOW 1M 3M 6M 12M 1M 3M 6M 12M
Laurus Labs Buy 374 450 402 71 6.4 5.0 20.1 -5.2 9.1 2.9 -3.3 -42.0
Lupin Buy 1029 1350 1122 670 -0.3 2.8 0.4 47.0 2.2 0.8 -19.2 -10.1
Sanofi India* Buy 8000 9600 8999 6756 -2.9 -1.6 -8.4 13.9 -0.4 -3.5 -26.3 -30.3
Shilpa Medicare Buy 345 520 692 283 -8.1 -22.1 -37.0 22.1 -5.8 -23.7 -49.3 -25.3
Solara Active Pharma Sciences Buy 1345 1700 1625 439 5.0 9.3 28.1 170.4 7.6 7.1 3.1 65.4
Strides Pharma Sciences Buy 839 1020 1000 313 -3.3 -11.7 15.5 163.8 -0.9 -13.4 -7.0 61.4
Sun Pharmaceutical Industries Buy 609 700 654 389 -0.4 0.5 16.9 45.9 2.1 -1.5 -5.9 -10.8
Torrent Pharma Hold 2520 3100 3040 2144 1.5 -9.7 -10.4 6.7 4.1 -11.5 -27.9 -34.7
BSE Health Care Index 21572 22464 14474 1.7 -2.0 6.7 59.7 4.3 -4.0 -14.1 -2.3
Building materials
APL Apollo Tubes^ Buy 1234 1330 1446 231 -7.7 39.1 -56.7 0.1 -5.3 36.3 -65.1 -38.8
Astral Poly Technik Hold 1637 ** 1988 576 -26.0 -5.0 37.6 68.2 -24.1 -6.9 10.8 2.9
Century Plyboards (India) Buy 319 360 340 100 -1.5 30.7 78.3 203.5 1.0 28.1 43.6 85.6
New Ide
Dalmia Bharat a Buy 1534 1900 1691 430 4.0 30.8 98.7 230.9 6.7 28.2 60.0 102.4
Grasim Buy 1447 1680 1472 463 8.0 47.0 90.9 179.8 10.8 44.0 53.7 71.1
New Ide
Greenlam Industries a
Buy 931 1100 976 471 -1.1 10.1 26.4 84.1 1.5 7.9 1.7 12.6
JK Lakshmi Cement Buy 425 525 448 180 -0.8 24.4 61.5 133.9 1.8 21.9 30.0 43.1
Kajaria Ceramics Buy 947 1200 1020 295 -4.5 33.4 76.3 166.0 -2.1 30.7 41.9 62.7
Pidilite Industries Buy 1798 1875 1888 1220 2.3 0.2 22.3 38.8 4.9 -1.8 -1.6 -15.1
Shree Cement Buy 30372 31610 30621 15900 9.1 22.4 49.7 82.6 11.8 20.0 20.5 11.7
Supreme Industries Limited Buy 2008 2330 2131 797 -3.8 14.3 47.7 145.6 -1.4 12.0 18.9 50.2
The Ramco Cements Buy 1009 1150 1048 457 -0.2 25.8 34.0 107.5 2.4 23.3 7.9 26.9
UltraTech Cement Buy 6794 8000 6993 3082 -0.2 24.7 64.2 107.6 2.3 22.2 32.2 27.0
Logistics
Gateway Distriparks Buy 181 210 189 71 0.6 43.5 87.3 97.9 3.2 40.6 50.8 21.0
Mahindra Logistics Buy 547 562 614 221 4.3 29.6 50.8 137.4 7.0 27.0 21.4 45.2
TCI Express Buy 914 1150 1024 495 0.6 -6.6 13.7 74.0 3.1 -8.5 -8.5 6.4
TCI Limited New Idea Buy 258 354 279 147 4.7 4.1 15.0 50.2 7.3 2.0 -7.4 -8.2
Discretionary
ABFRL Buy 188 255 224 96 -13.2 12.8 42.2 25.8 -11.0 10.5 14.5 -23.0
Arvind@ Buy 66 95 84 20 -15.7 30.0 92.9 197.8 -13.6 27.4 55.3 82.1
Bata India Buy 1397 1765 1705 1153 -8.5 -15.8 3.5 12.0 -6.2 -17.5 -16.7 -31.5
Inox Leisure Buy 269 400 359 158 -18.8 -19.5 -5.0 12.9 -16.8 -21.1 -23.5 -31.0
Jubilant Foodworks Buy 2839 3380 3215 1312 -7.6 1.8 21.9 100.9 -5.3 -0.3 -1.8 22.9
KPR Mill Buy 1049 ** 1151 334 6.4 20.6 58.2 208.2 9.1 18.2 27.3 88.5
Relaxo Footwear Buy 913 1005 966 578 9.0 1.7 35.0 47.1 11.8 -0.4 8.7 -10.0
The Indian Hotels Company Buy 108 155 139 62 -13.9 -12.4 7.2 46.3 -11.7 -14.1 -13.7 -10.5
Titan Company Limited Buy 1535 1710 1621 810 4.1 -2.5 27.9 62.1 6.7 -4.5 3.0 -0.8
Trent Ltd Buy 729 1015 945 402 -17.4 7.7 7.6 59.6 -15.3 5.5 -13.4 -2.4
Welspun India Buy 83 90 88 21 13.8 17.9 14.1 276.9 16.6 15.5 -8.2 130.5
Wonderla Holidays Hold 194 227 235 105 -10.1 -7.5 19.3 44.5 -7.8 -9.4 -4.0 -11.6
ZEE Entertainment Buy 202 275 261 126 -7.3 -8.7 -6.8 43.2 -4.9 -10.5 -25.0 -12.4
Diversified / Miscellaneous
Bajaj Holdings Buy 3290 4312 3785 1850 -8.4 5.9 33.6 66.1 -6.1 3.8 7.5 1.6
Castrol India Buy 125 150 140 103 -7.4 -0.3 12.2 17.7 -5.0 -2.3 -9.7 -28.0
Mahindra Lifespace Buy 543 655 577 171 3.5 46.1 129.9 185.1 6.1 43.2 85.1 74.4
Polyplex Corporation Hold 846 950 945 337 -7.5 19.8 16.7 121.4 -5.2 17.4 -6.1 35.4
Quess Corp Buy 657 715 807 165 -7.6 24.8 58.5 205.4 -5.2 22.3 27.6 86.8
Triveni Engineering & Industries Buy 82 90 98 35 -11.5 13.1 9.2 96.8 -9.3 10.8 -12.1 20.3
BSE500 Index 19580 20390 11484 -1.9 4.9 28.0 72.6 0.6 2.8 3.1 5.5
CNX500 Index 12299 12816 7234 -1.9 4.8 27.8 72.0 0.6 2.7 2.9 5.2
CNXMCAP Index 23799 24740 12243 -1.2 9.9 38.2 99.5 1.3 7.7 11.3 22.0
** Price under review @ Reco price adjusted for demerger # Reco price adjusted for bonus ^ Reco price adjusted for stock split
* Price targets will be reviewed after we get further clarity on operations from companies post Q4FY2020 result announcements.
APRIL 2021 7 Sharekhan ValueGuideFrom the Editor’s Desk
From the Editor’s Desk Bumps on the road to recovery
As it bid goodbye to FY2021, the rally of Indian equities took a halt in March, as it faced the
onslaught of the second wave of the Coronavirus pandemic. What added to the trouble was the
volatile movement in bond yields. Despite the volatility, the Sensex and Nifty ended the month
only marginally higher, by 0.8-1%.
What appears more alarming with respect to the renewed spurt in COVID-19 cases is the
selective spread, with some states reporting a far more alarming rise in cases than others.
Notably, Maharashtra, which accounts for 14% of India’s GDP and is among the nerve-centres of
Indian industry, has seen the most number of active cases in recent weeks, prompting the state
government to impose fresh lockdown measures. The situation is similar in other states such as
Karnataka and Kerala.
Though macro-economic indicators aren’t showing much signs of stress as of now, the renewed
restrictions may hit economic activity in the April-June quarter, especially in the services sectors.
With the shutdown of malls, recreation spaces and restaurants, a sharp drop could be seen in
the retail and discretionary sectors. However, with governments permitting the continuation
of essential services and manufacturing units, the consumer goods sector should continue
clocking growth. Other core economic indicators such as power demand rail freight also remain
strong. Even though India’s manufacturing PMI slipped to a seven-month low of 55.4 in March
from 57.5 in February, the reading remained above the crucial 50-mark.
In the first monetary policy review for FY2022, the Reserve Bank of India (RBI) kept the repo rate
unchanged and persisted with an accommodative policy stance, amid a resurge in COVID-19
infections and the attendant uncertainty. The biggest takeaway was that the central bank
maintained its growth forecast for FY22 at 10.5% and also introduced a new bond purchase
programme, in a bid to manage bond yields better and keep liquidity conditions comfortable.
Overall, the consistency in the central bank’s policy stance comforted the equity markets as
both the Sensex and Nifty soared post Mint Street’s announcements.
Moves such as extending the TLTRO on Tap Scheme further up to September and prolonging
the ‘priority-sector’ tag for bank lending to NBFCs are also encouraging.
Last but not the least is the onset of the Q4FY21 corporate earnings season. The reforms
announced in the Budget, a pick-up in private investment activity and the government’s capital
expenditure should continue supporting a sustained earnings recovery. As compared to last
year, the corporate sector is better prepared to deal with COVID-related restrictions this time
around. However, it would be interesting to watch out for the management commentary on the
growth outlook.
Our research team is positive on the equities and believes that the near-term issues are only
speed-bumps in the multi-year cyclical uptrend in the economy.
Happy Investing!
APRIL 2021 8 Sharekhan ValueGuideEQUITY FUNDAMENTALS STOCK IDEA
Dalmia Bharat Limited
Date: March 02, 2021 Rising through the ranks
Reco Price
Buy PT : Rs. 1,900 Rs. 1,467
Summary
• We initiate coverage on Dalmia Bharat (Dalmia) with a Buy rating and price target of Rs. 1,900. Multiples to expand from 8.5x EV/EBITDA FY23E currently as it gains
size, geographical diversification and higher operational profitability.
• Dalmia is on an expansion spree in the medium to long term and aims to double its capacity and become a larger pan-India player.
• Despite aggressive expansions, it is likely to achieve net cash position by FY2023E led by free cash flows of almost Rs. 1,200 crore p.a. during FY2021-FY2023E.
• The government’s infrastructure investment plan over the next five years, impetus on affordable housing and India’s structural growth drivers for cement consumption
present strong growth tailwinds.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Dalmia-Mar01_2021_3R_Stock_Idea.pdf
Sumitomo Chemical India Limited
Date: March 17, 2021 Cream of the crop
Reco Price
Buy PT : Rs. 350 Rs. 275
Summary
• We initiate coverage on Sumitomo Chemical India Ltd. with a Buy and PT of Rs. 350; SCIL is part of Sumitomo Chemical Company (Japan) and a leading player with
an 11% share in domestic agri-input market.
• Strong parentage offers competitive edge in terms of technical capabilities, strong distribution and R&D support would drive 12% CAGR in revenue and a 291 bps
rise in margins over FY21E-FY23E.
• Merger with Excel Crop Care (ECCL) has strengthened generic product portfolio and geographical reach. Leveraging on parent and merger synergies would aid a
21% CAGR in PAT over FY21E-FY23E.
• Robust balance sheet with net cash (including liquid investment) of Rs. 680 crore and high asset turnover ratio would keep RoE/RoCE high at 24%/32%. We expect
SCIL to continue enjoying premium valuation over domestic peers.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Sumitomo-3R-Mar17_2021_3R_StockIdea.pdf
Mahindra & Mahindra Financial Services Limited
Date: March 19, 2021 Turning the wheels of fortune
Reco Price
Buy PT : Rs. 260 Rs. 202
Summary
• M&M Financial Services (MMFS) has evolved into a multi-product auto finance NBFC operating pan-India, having deep penetration and rural-centric strong network
from being a vehicle financing arm for M&M earlier.
• Normalisation of credit costs and pick-up in AUMs in FY22E and FY23E would drive earnings and RoE.
• Stock trades at 1.8x / 1.7x FY2022E / FY2023E on standalone ABVPS; strong parent backing, strong and stable credit rating profile and high capital levels make
business attractive.
• We initiate coverage with a Buy and Price Target (PT) of Rs. 260.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/MnM_Financial-Mar19_2021_3R_Stock_Idea.pdf
APRIL 2021 9 Sharekhan ValueGuideSTOCK IDEA EQUITY FUNDAMENTALS
Transport Corporation of India Limited
Date: March 22, 2021 Delivering a strong growth story
Reco Price
Buy PT : Rs. 354 Rs. 243
Summary
• We initiate coverage on Transport Corporation of India Limited (TCI) with a Buy and SOTP-based price target of Rs. 354.
• TCI is well-set to benefit from strong growth outlook for logistics given its six-decade track record in offering integrated multi-modal transport and supply chain
solutions.
• Rising share in LTL freight and value-addition in FTL freight, besides a revival in auto and non-auto SCM and expansion of seaways biz would help PAT clock a 15%
CAGR over FY2021-FY2023.
• GST-led tailwinds, impact of COVID-19, government thrust on AtmaNirbhar Bharat and global supply chain re-alignments would be key growth drivers.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/TCI-Mar22_2021_3R_Stock_Idea.pdf
Blue Star Limited
Date: April 05, 2021 Well-conditioned for long-term growth
Reco Price
Buy PT : Rs. 1,200 Rs. 922
Summary
• We initiate coverage on Blue Star (Blue Star) with a PT of Rs. 1,200, given its high net earnings growth trajectory for FY2021E-FY2023E and favourable relative
valuation.
• Expectation of strong summers, focus on technology, in-house manufacturing, introduction of new products and a recovery in project segment will be near-term
growth drivers.
• Company would focus on growing higher than industry growth rates, improving profitability through scale and backward integration, deepening distribution reach
and pursuing profitable adjancies.
• Revenue and earnings to clock a 27% and 71% CAGR, respectively for FY2021-2023E driven by core UCP segment along with improvement in OPM while return
ratios are expected to improve.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/BlueStar-Apr05_2021_3R_Stock_Idea.pdf
Sharekhan Limited, its analyst or dependant(s) of the analyst might be holding or having a position in the companies mentioned in the article.
APRIL 2021 10 Sharekhan ValueGuideEQUITY FUNDAMENTALS Stock Update
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 01, 2021 APL Apollo Tubes Limited Stock Update BUY 1,093 1,330
Summary
APL Apollo Tubes Limited (APL) announced the merger of Apollo Tricoat with itself, wherein minority shareholders of Apollo Tricoat will receive one equity
share of APL for one share of Apollo Tricoat. The deal is expected to be completed by December 2021 post regulatory approvals.
Management has guided that the merger would be EPS/RoE accretive, as equity dilution of 10.8% would get offset by nil minority interest as Apollo Tricoat will
get fully merged with APL. The deal values Apollo Tricoat at 16% premium to CMP on February 26, 2021.
Management expects synergies across cost, products, and branding and expects minimum improvement of Rs. 150/tonne in EBITDA margin although the exact
quantum of synergies is to be provided latter. The merger would also facilitate faster capacity expansion and facilitate penetration of Tricoat products in West
and East.
Improved earnings quality post the merger (higher margin/RoE), focus on home décor, and brand building are likely to further re-rate APL and reduce valuation
gap with building material players. We retain Buy on APL with a revised PT of Rs. 1,330.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/APL-3R-Mar01_2021.pdf
March 01, 2021 Aditya Birla Fashion and Retail Limited Stock Update BUY 193 255
Summary
Aditya Birla Fashion & Retail Limited (ABFRL) is eyeing a 15% CAGR in revenue growth over FY2020-26, by achieving a steady growth of 11-16% CAGR in the
core businesses of Pantaloons and lifestyle brands and a scale-up in new businesses.
The company aims to achieve OPM of 11.2% in FY26 from 7.6% in FY20 by improving product mix for lifestyle business, boosting store-level profitability of
Pantaloons and making all new ventures profitable through scale-up.
ABFRL is focusing on achieving cumulative free cash flow of Rs. 2,000 crore over FY22-26; RoCE of over 35% by FY26.
Robust business model, structural growth story of branded apparel market and strengthening of balance sheet makes ABFRL a preferred pick in the
discretionary consumption theme. We maintain a Buy with a revised PT of Rs. 255.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/AdityaBirla-3R-Mar01_2021.pdf
March 02, 2021 Trent Limited Stock Update BUY 906 1,015
Summary
India’s branded apparel industry is expected clock a CAGR of 10% over FY2020-25 driven by better urban and rural demographics and a significant shift to
branded products.
With strong contribution from private labels, higher sales per sq.ft (versus peers) and a strong balance sheet, Trent is expected to be key beneficiary of growing
apparel demand in the coming years.
Trent will continue to add 80-100 stores every year (including 25-30 Westside stores and 40-50 Zudio stores). This along with steady same-store-sales growth
of 8-9% per annum will help revenues record a CAGR of 9% over FY2020-23E (to grow by 40% over FY21-23).
We have increased our estimates for FY2023E by 5% to factor in strong revenue growth of FY2023. We maintain a Buy on the stock with a revised PT of Rs. 1,015.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Trent-3R-Mar02_2021.pdf
March 02, 2021 Bharat Electronics Limited Stock Update BUY 151 190
Summary
We retain a Buy rating on Bharat Electronics Limited (BEL) with a revised PT of Rs. 190 modestly increasing our target PE to factor overall rerating in the PSU
space and considering BEL execution capabilities.
BEL is well positioned to benefit from rising defence expenditure supported by a strong manufacturing base, execution track record and continued focus on
developing in-house R&D capabilities.
Strong YTD order inflow, healthy order pipeline and order book offer sustainable revenue visibility.
With Aatma Nirbhar Bharat and domestic procurement, the entire PSU pack is getting rerated which augurs well for BEL which is trading at the steep discount
to the peak 5-year average multiple.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/BEL-3R-Mar02_2021.pdf
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APRIL 2021 11 Sharekhan ValueGuideStock Update EQUITY FUNDAMENTALS
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 03, 2021 Infosys Stock Update BUY 1,344 1,650
Summary
We retain our Buy rating on Infosys with a price target to Rs. 1,650, given higher demand for digital and Cloud transformation initiatives and strong deal pipeline.
Infosys’ strategic investments in Cloud, data, and experience have been yielding results, which are being reflected from digital revenue growth of 7.6% CQGR
since Q1FY2018.
Revenue growth in FY2022E would be driven by 1) higher demand for digital transformation initiatives, 2) increasing core transformation, 3) continued strong
deal wins, 4) better pricing for the digital portfolio, and 5) robust deal pipeline.
Margin headwinds would be offset to some extent because of higher offshore mix, automation, improving onsite employee pyramid, lower sub-contractor
expenses, and better pricing in digital offering.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Infosys-3R-Mar03_2021.pdf
March 03, 2021 NMDC Limited Stock Update BUY - 137 165 -
Summary
We re-initiate coverage on NMDC with a Buy rating and PT of Rs. 165 as valuation of 3.7x FY23E EV/EBITDA for core business factors in risks associated with
higher royalty payout but ignores value unlocking from Nagarnar Steel Plant.
Multiple triggers for higher iron ore production given re-start of Donimalai mine, expansion for Kumarasamy mines and debottlenecking at Chhattisgarh mines.
We expect 30%/7% y-o-y growth in iron ore sales volume to 43mt/46mt in FY22E/FY23E.
Higher volume and elevated iron ore price (given high international price >$150-160/ton currently and likely iron ore deficit in domestic market until FY23)
would cushion NMDC’s earnings from potential royalty premium (assumed at 22.5%).
Strategic sale of Nagarnar Steel plant would result into value unlocking of CWIP of Rs16,500 crore and could add further value (~Rs22-25/share) to the stock
as street is ascribing only 50% value to steel plant.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/NMDC-3R-Mar03_2021.pdf
March 03, 2021 Bajaj Auto Limited Stock Update BUY 3,901 4,589
Summary
We interacted with the management of Bajaj Auto Limited (BAL) to discuss its plans for electric two-wheelers (e-2Ws) and readiness to benefit from increasing
e-2W penetration in the medium to long term. The company is well positioned both in terms of capacity and capability to roll out faster e-2Ws, if the adoption
of electric vehicles succeeds at a faster rate.
BAL is expected to benefit from growth in the premium bikes segment, which is recovering, aided by premiumization trend and new launches. Moreover, we
expect BAL to gain market share in exports, driven by its brand equity and enhanced distribution network.
Improvement in operating profit margin (OPM) witnessed in Q2 & Q3 of FY21 is likely to stay, driven by cost and operational efficiency.
The stock is trading at P/E multiple of 17.9x and EV/EBITDA multiple of 12.2x its FY2023E estimates and is at below its long-term average multiples. We retain
our Buy rating on the stock.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Bajaj-3R-Mar03_2021.pdf
March 03, 2021 Hero MotoCorp Limited Stock Update BUY 3,424 4,030
Summary
We interacted with the management of Hero MotoCorp (Hero) to discuss its plans for electric two-wheelers (e-2Ws) and readiness to benefit from increasing
e-2W penetration in the medium to long term.
We believe structural growth traction in the two-wheeler (2W) industry remains intact and Hero continues to benefit from premiumisation of its products, its
stronghold in the economy and executive motorcycle segments, and aggressive products offerings in the premium bike and scooters segments.
Hero will continue to benefit from its brand equity, due to value-for-money products, extensive service centres, low maintenance cost and higher resale value.
The stock is valued at P/E multiple of 16.1x and EV/EBITDA multiple of 9.5x its FY2023E estimates. We retain a Buy rating on the stock.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Hero-3R-Mar03_2021.pdf
March 04, 2021 Wipro Limited Stock Update BUY 439 510
Summary
We maintain a Buy on Wipro with an unchanged PT of Rs. 510 given its strategic acquisition of Capco in BFSI space and significant external hires to achieve
industry-matching growth.
Wipro would acquire Capco, an end-to-end management consulting services and digital transformation solutions provider in the BFSI space, in a $1.45 billion
all-cash deal. Company’s net cash stood at about Rs. 450 billion as of Q3FY2021.
Deal would help Wipro boost its presence in BFSI segment, enhance capabilities, acquire talents and new clients and also win large transformational deals.
The addition of 30 financial clients (79% of Capco’s revenue) from acquisition would significantly enhance the access to industry spends.
Wipro has redefined its strategic focus to drive growth with speedy decisions in making large strategic M&A in BFSI space, significant staffing changes and
hires in leadership positions.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Wipro-3R-Mar04_2021.pdf
APRIL 2021 12 Sharekhan ValueGuideEQUITY FUNDAMENTALS Stock Update
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 04, 2021 Dr Reddy’s Laboratories Limited Stock Update BUY 4,574 6,500
Summary
We re-iterate Buy recommendation on Dr Reddy’s Laboratories Limited (DRL) with an unchanged PT of Rs 6500.
Improving growth prospects, sturdy new product pipeline, growth in the base business would be te key drivers for US business, which is expected to clock a
double digit growth over the next two years.
India business expected to stage a double digit growth backed by improvement in the IPM, pick up in the acquired portfolio and an expected growth in the
acute therapy.
The Sputnik-V Vaccine, if approved, could unlock sizeable growth potential and could result in earnings upgrades.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/DrReddy-Mar04_2021.pdf
March 04, 2021 Greaves Cotton Limited Stock Update BUY 139 170
Summary
We interacted with the management of Greaves Cotton Limited (Greaves) to take a deep dive into the company’s new transformative business goals. We
believe the company is moving on the right track with huge potential for business growth. We maintain our Buy rating on the stock with a revised PT of Rs. 170.
Greaves is well positioned to benefit from the government’s push towards fast adoption of electric vehicles (EVs) in the automobile industry.
We have revised our earnings estimates upwards and expect Greaves’ earnings to report a robust 80.3% CAGR during FY2021E-FY2023E, driven by 24.4%
revenue CAGR and a 580 bps improvement in EBITDA margin.
The stock is trading below its average historical multiple at P/E multiple of 17.2x and EV/EBITDA multiple of 10.2x its FY2023E estimates.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/GreavesCotton-3R-Mar04_2021.pdf
March 04, 2021 JK Lakshmi Cement Limited Stock Update BUY 434 525
Summary
We retain a Buy rating on JK Lakshmi Cement (JKL) with a revised PT of Rs. 525 given attractive valuations and healthy net earnings estimates over FY2021E-
FY2023E.
Average cement prices in the West and North (together ~75% of sales mix) in Q4FY2021 till date are up 3.7% and 2.0% versus Q4FY2020. Prices in the East rose
sharply by 7.4% m-o-m in March 2021 leading to positive q-o-q growth for Q4.
We expect JKL to benefit from strong non-trade demand environment in North and West and sustained healthy trade demand in East.
Company to raise equity at UCW level through a rights issue for its Rs. 1,500 crore expansion plan, which is expected to ease clinker and capacity constraints.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/JK_Lakshmi-3R-Mar04_2021.pdf
March 05, 2021 Nippon Life India Asset Management Stock Update BUY 353 418
Summary
Nippon Life India Asset Management Company (NAM) has shown improved performance of its equity funds, stabilising SIP inflows, and concerns related to loss
in market share, which seem to be left behind now.
Moreover, efforts taken towards cost optimisation along with expected growth in AUM could result in operating leverage playing out and boosting return on
equity (RoE).
Given industry tailwinds, improving operational performance, and reasonable valuations (33x/28x its FY2022E/FY2023E EPS; On market cap to AUM basis,
NAM at 7.6%, which is at a steep discount to 17% commanded by the industry leader); we see scope for further re-rating of the stock.
Consequently, we maintain our Buy rating with a revised price target (PT) of Rs. 418.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/NAM-3R-Mar05_2021.pdf
March 05, 2021 Mahindra Lifespace Developers Limited Stock Update BUY - 524 655 -
Summary
We re-initiate coverage on Mahindra Lifespace Developers Limited (MLDL) with a Buy rating and price target of Rs. 655, owing to high discount to NAV and
strong growth outlook.
MLDL has formed a formidable core management team over a year having credible experience from leading real estate firms to boost sales and execution.
The company targets to achieve pre-sales target of over Rs. 2,000 crore per year over the next two to three years from Rs. 500 crore to Rs. 1,100 crore range
during FY2016-FY2020.
The company’s low gearing is likely to aid in land acquisitions.The company is likely to benefit from the government’s affordable housing focus, inorganic
opportunities, and favourable state government’s policies to name a few.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/MahindraLifespace-3R-Mar05_2021.pdf
APRIL 2021 13 Sharekhan ValueGuideStock Update EQUITY FUNDAMENTALS
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 05, 2021 Shoppers Stop Limited Viewpoint POSITIVE - 247 28-30% -
Summary
We re-initiate a viewpoint on Shoppers Stop (SSL) with a Positive view and expect an upside of 28-30% in 10-12 months. SSL’s market value (trading at 6x its
FY23E EV/EBIDTA) is significantly lower as compared to its peers and offers a deep value coupled with a highly favourable risk-reward for investment.
With the management focusing on regaining lost ground with a change in leadership and revamped growth strategies, we expect a big room for re-rating of
the stock also the company has strong balance sheet with no debt on books.
Increase in share of private labels, higher sales growth from First Citizen customers and personal shoppers, higher contribution from beauty and personal care
products and strong increase in sales through omni channel are the four key pillars of growth for SSL.
Cost-saving measures would help the company to save cost of Rs. 450 crore in FY2021 and Rs. 200-220 crore in FY2022; this along with a better product mix
would help profitability remain high in FY22/23.
Read report - https://www.sharekhan.com/MediaGalary/Equity/Shopper_Stop-3R-Mar05_2021.pdf
March 08, 2021 Kajaria Ceramics Limited Stock Update BUY 997 1,200
Summary
We retain Buy on Kajaria Ceramics with a revised PT of Rs. 1200, as we believe the company is entering into a high growth phase led by structural demand
drivers.
The tile industry is expected to grow at 8.6% CAGR over 2020-2027 led by residential market and new construction. Kajaria is poised to grow at higher than
industry growth rates led by market share gains.
Morbi tile exports continue to remain strong and is expected to close the fiscal year at higher exports numbers than last year. Hence, stable pricing and
domestic market share gains for Kajaria remain intact.
Natural Gas if brought under the GST ambit may lead to higher operating margins as companies claim input tax credit.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Kajaria-3R-Mar08_2021.pdf
March 09, 2021 Cummins India Limited Stock Update BUY 857 1,030
Summary
We retain a Buy on Cummins India Limited (Cummins) with a revised PT of Rs. 1,030, considering strong earnings growth potential, led by a domestic economic
revival.
Domestic sales are recovering as visible in macro indicators, signaling a strong pick-up in business activities; exports would benefit from improved demand
from data centres, 5G rollout and the China+1 strategy.
Company is well-placed to take advantage given that it is technologically prepared and has market leadership position; CPCB-IV norms can lead to further
market share gains.
Led by AatmaNirbhar Bharat, localized procurement and a faster pick-up in manufacturing activity, the entire sector is getting rerated which augurs well for
Cummins, which trades at a discount to its peak 5-year average multiple.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/CumminsIndia-3R-Mar09_2021.pdf
March 09, 2021 GAIL (India) Limited Stock Update BUY 149 175
Summary
Recent sharp rally in oil price has improved the earnings outlook for GAIL’s downstream segments – petchem and LPG-LHC. Higher oil/stable spot LNG price of
$6-7/mmbtu to improve competitiveness of GAIL’s US LNG contracts and drive strong earning growth (expect a 29% PAT CAGR over FY21E-FY23E).
Higher petchem plant utilisation (already at 106%) and commissioning of pipeline infrastructure projects (Urja Ganga and Barauni-Guwahati) to drive
sustainable growth for gas transmission/marketing volume.
Potential inclusion of gas under GST and likely value unlocking from monetization of gas pipeline assets would be key re-rating catalyst for GAIL in FY2022.
GAIL is trading at an attractive valuation of 6.5x its FY2023E EV/EBITDA (27% discount to historical average EV/EBITDA multiple) and offers healthy dividend
yield of ~5%. Hence, we maintain our Buy rating on GAIL with a revised PT of Rs. 175.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/GAIL-3R-Mar09_2021.pdf
March 09, 2021 Welspun India Limited Stock Update BUY 72 90
Summary
We retain a Buy on Welspun India (Welspun) with a PT of Rs. 90; higher export opportunities in home textile and flooring business and a likely beneficiary of
the PLI scheme in advance textiles business make it a better play in the space.
India’s exports of terry towels and bed-sheets to the US grew by ~19% and 47% in January. For both products, the share of exports improved by 570BPS and
510BPS for both the products. Welspun’s share in US terry towel exports stands at 20% and bed-linen around 11-12%.
Share gains in home textile segment exports to US, scale-up of flooring business (likely to contribute Rs450-500crore in FY23) and advance textiles business
(likely to contribute Rs600crore in FY23) are long-term growth drivers. The government’s PLI scheme is also likely to offer incremental benefits.
Despite a strong capex plan to support growth in key segments, net debt is expected to remain at Rs. 2,400 crore as large capex funding will be done by
improving cash flows.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Welspun_India_3R-Mar09_2021.pdf
APRIL 2021 14 Sharekhan ValueGuideEQUITY FUNDAMENTALS Stock Update
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 10, 2021 UltraTech Cement Stock Update BUY 6,767 8,000
Summary
We maintain Buy on UltraTech Cement (UltraTech) with a revised PT of Rs. 8,000, owing to high probability of upward revision in earnings estimates in the near
term and strong visibility of long-term demand growth.
Construction of houses under PMAY show strong growth for FY2021 till date. Road project awards and construction maintain the growth momentum. Property
registrations in Maharashtra are robust for March 2021 till date.
Pan-India cement prices rose sharply by 3.8% m-o-m/6.6% y-o-y in February-end till date. East saw a 7.4% m-o-m hike, while other regions saw an uptick of
2.3%-3.6%.
The company’s 19.5 mtpa expansion plan at a cost of Rs. 6,527 crore (without affecting de-leveraging plan) to ensure industry outperformance over the next
four to five years.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Ultratech_3R-Mar10_2021.pdf
March 10, 2021 AU Small Finance Bank Stock Update BUY 1,255 1,500
Summary
AU Small Finance (AUSFB) has announced its plans to raise equity funds via Qualified Institutional Placement (QIP), which will provide growth capital, help
the bank on its way to become a Universal Bank.
As per our calculations, Tier-1 ratio will likely increase by ~240 bps, equity dilution to be small (~1.6%), but the book value (Calculated) may increase by ~9.7%.
AUSFB is available at 6.1x/4.9x its FY2022E/FY2023E ABPVS; expect bank to report healthy ROA/ROE to improve to 1.9%/18.1% in FY2023E from 1.8%/17.9%
in FY2020.
We maintain Buy on the stock with a revised price target (PT) of Rs. 1,500.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/AUSmall-3R-Mar10_2021.pdf
March 10, 2021 Laurus Labs Limited Stock Update BUY 365 450
Summary
We retain a Buy recommendation on Laurus Labs Limited (Laurus) with a revised PT of Rs. 450.
Formulations business on a strong footing to grow backed by opportunities in the US while diversification to non ARV areas – anti diabetics and cardiology to
fuel API growth.
Sturdy growth prospects, visibility on earnings, healthy return ratios and low debt-equity are the key positives.
Over a long term horizon of 3-5 years, Laurus has charted out its growth trajectory encompassing all segments & management aspires grow its revenues
beyond $1bn in size.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/LaurusLabs-3R-Mar10_2021.pdf
March 10, 2021 Sundram Fasteners Limited Stock Update BUY 728 850
Summary
We maintain our Buy rating on Sundram Fasteners Limited (SFL) with a revised PT of Rs. 850, factoring in better multiples on a strong traction in business
outlook and an upgrade in earnings estimates.
Interaction with the management indicates that strong growth traction in automotive industry led by growth in sales of commercial vehicles, tractors, passenger
cars and two wheelers. Export and non-automotive segments continue to be the focus area with a strategy to de-risk business from cyclicality.
We expect SFL’s earnings to improve by 60.1% during FY21E-23E, driven by a 25% CAGR during FY2021E-23E and a 360-bps improvement in EBITDA margin.
Stock trades at P/E multiple of 25.2x and EV/EBITDA multiple of 15.1x its FY2023E estimates.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Sundram_3R-Mar10_2021.pdf
March 12, 2021 Honeywell Automation India Limited Stock Update BUY 48,901 56,265
Summary
We retain a Buy on Honeywell Automation India with a revised price target of Rs. 56,265 considering its strong earnings growth potential, led by a domestic
economic recovery.
The management expects FY2021 performance to be better than FY2020, backed by execution capabilities and growing demand for industrial automation
and software solutions.
Growth in the domestic business is expected to benefit Honeywell driven by increasing technological capabilities with large opportunities in sectors such
as oil & gas, pharma & life sciences, smart cities, airports and building solutions. This provides strong growth visibility for FY2022. Exports to remain steady.
New brand to cater to SMEs, providing tailor-made products and solutions. Company foresees huge opportunity ahead and expects business to contribute
10% of revenues in 2-3 years.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Honeywell-3R-Mar12_2021.pdf
APRIL 2021 15 Sharekhan ValueGuideStock Update EQUITY FUNDAMENTALS
Recommendation Price Target/ Upside (%)
Date Company Report Type Reco Price (Rs.)
Latest Chg Latest Chg
March 12, 2021 Affle (India) Limited Stock Update BUY 5,809 6,580
Summary
We maintain Buy on Affle (India) Limited with a revised price target (PT) of Rs. 6,580, given its presence in high-growth industries, unique CPCU business model,
and possible beneficiary from the change relating to cookies on browsers.
The change relating to third-party cookies on browsers could be positive for Affle as more advertiser budgets would flow to mobile in-app and on-device
advertising.
In a year, Q3 continues to remain the highest quarter for Affle on account of business seasonality. We expect revenue to grow by 68% y-o-y to ~Rs. 135 crore
in Q4FY2021, while margins are expected to contract on a y-o-y basis.
Anticipated proceeds (Rs. 1,080 crore) from the forthcoming fund-raising activities via securities would be used to enhance its reach to connected devices by
5x over the next 10 years. We expect Affle to report a 35% CAGR in revenue over FY2020-FY2023E.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Affle_3R-Mar12_2021.pdf
March 12, 2021 Mahindra Lifespace Developers Limited Stock Update BUY 549 655
Summary
We retain Buy on Mahindra Lifespace Developers Limited (MLDL) with an unchanged price target of Rs. 655.
Our interaction with the management reinforces our view on the company’s change in approach towards being aggressive with a strong management team
at the helm.
The company is likely to reach a sales target of Rs. 2000 crore to Rs. 2500 crore sales target over next two to three years by building depth in three key cities.
Low gearing to allow aggressive land acquisitions to build size.
MLDL to benefit from strong momentum in residential market with inventory overhang lowering down, lower interest rate regime, consolidation, favourable
government policies etc.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Mahindra_Lifespace_3R-Mar12_2021.pdf
March 12, 2021 Gabriel India Limited Stock Update BUY - 116 160 -
Summary
We re-initiate our coverage on Gabriel India Limited (Gabriel) with Buy rating and a PT of Rs. 160 owing to its leadership position and brand recall in the
suspension components segment; company would also benefit from rising automotive demand.
Gabriel is well-positioned to gain from the government’s push on rapid adoption of EVs, especially in 2W and 3W segments, where it is developing products
with leading players.
Net earnings set to clock a 55.2% CAGR over FY21E-23E, driven by an 18% CAGR during FY2021E-23E and a 270 bps rise in EBITDA margins.
Stock trades at attractive P/E multiple of 13.1x and EV/EBITDA multiple of 7.1x its FY2023E estimates.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/Gabriel-3R-Mar12_2021.pdf
March 12, 2021 Gujarat Gas Limited Stock Update BUY 517 630
Summary
GGAS is expected to post highest volume CAGR of 22.4% over FY21E-FY23E among CGD players, which warrants an upgrade of valuation multiple. We thus
increase our PE multiple to 24x; raise PT to Rs. 630 and retain Buy on GGAS.
Morbi gas volumes could increase further as Morbi Ceramic Association expects growth of 25-30% in FY22 with addition of 60 new units. Crackdown of
polluting industrial areas and volume ramp-up from new GAs provides strong volume impetus.
Potential inclusion of natural gas under GST could be game changer for GGAS as the same is expected significantly boost industrial PNG demand (80% of
GGAS’s overall volume) as customers would be able to avail benefit of input tax credits.
We expect GGAS’s valuation gap with IGL to narrow down as GGAS has much better volume growth outlook, superior RoE and strong FCF generation. GGAS
trades at 11% discount to IGL.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/GujGas-3R-Mar12_2021.pdf
March 12, 2021 Mahanagar Gas Limited Stock Update BUY 1,208 1,450
Summary
MGL’s volume outlook has improved considerably, while high margins are sustainable given the favourable economics of CNG versus petrol. This gives us
confidence on strong volume/margin-led earnings growth for MGL (expect 18% PAT CAGR over FY21E-FY23E).
The management expects double-digit volume growth in FY2022 and a sustainable 6% volume growth annually thereafter led by a regulatory push and
potential ramp-up of volume at Raigad GA (0.6 mmscmd volume potential).
We expect high margins for MGL to sustain as pricing power in CNG (accounts for 73% of overall gas sales volumes) gives ability to pass on likely increase in
APM gas prices to end customers. Hence, we maintain an EBITDA margin assumption of Rs. 12/Rs. 11.6 per scm over FY21/FY23.
MGL’s 20% underperformance to Sensex in the past one year should reverse as volume growth outlook has improved. MGL’s valuation of 12.9x its FY2023E
EPS is most attractive in the CGD space. Thus, we retain a Buy with a revised PT of Rs. 1,450.
Read report - https://www.sharekhan.com/MediaGalary/StockIdea/MGL-3R-Mar12_2021.pdf
APRIL 2021 16 Sharekhan ValueGuideYou can also read
