Thanks to the ongoing correction in domestic stock markets, some fundamentally sound companies are now available at attractive valuations, national brokerage firm HDFC Securities said in its report. In this regard, he suggested stocks from the oil and gas, AMC and chemical sectors with up to 70% upside.
The brokerage suggested that market participants with long and medium-term views can take advantage of this opportunity to consolidate their positions in their respective high-conviction stocks.
In this regard, HDFC Securities chooses the top 5 picks in different sectors:
CGSB – Target: Rs 275; Up: 70%
Oil and Natural Gas Corporation (ONGC) is a state-owned oil exploration and production company. The company was helped by rising crude oil prices, as the stock gained more than 5% on Tuesday and jumped nearly 8% in the past two sessions.
ICICI shares – Target: Rs 740; Up: 63%
An asset management arm of ICICI Bank – Shares of ICICI Securities have corrected nearly 42% in the past six months and are available at cheap valuations. The company operates a virtual financial supermarket, serving the three needs of its customers: investments, protection and borrowing.
Kansai Nerolac Paints – Target: Rs 630; Up: 56%
Subsidiary of Kansai Paint of Japan – Kansai Nerolac Paints Limited is the largest industrial paint company and the third largest decorative paint company in India. The stock has been beaten (down 31% in 6 months) mainly due to rising crude oil prices, but its fundamentals are strong.
Aarti Industries – Target: Rs 1155; Up: 64%
Aarti Industries is one of India’s leading specialty chemicals and pharmaceuticals manufacturers with a global footprint. Management gave an investment forecast of Rs 30 billion over the next 2 years and said that all capacities put in place in FY22 are expected to increase and be utilized by the end of the financial year 24.
Nippon Life India – Target: Rs 425; Up: 54%
The company is one of the largest asset management companies in India, managing directly and indirectly) assets in mutual funds, pension funds, managed accounts, alternative investments and offshore funds. It is the second title in the list of the AMC segment that HDFC Securities has chosen.