The Union Budget 2024 seems to have failed to boost domestic market sentiment, which has been cautious due to concerns over rich valuation, mixed Q1 earnings and uncertainty over the beginning of the rate cut cycle in the US.
The Nifty 50 has been down for the last five consecutive sessions, coming down by about 2 per cent from its all-time high hit last Friday.
Experts see this correction as healthy as it will offer some comfort on the valuation front. Considering key structural positives, such as the prospects of solid economic growth, robust retail investor participation and easing inflation, experts see the corrections as opportunities to buy quality stocks.
Experts from Motilal Oswal and Nuvama recommend buying these five stocks with a year of investment horizon. Take a look:
Sneha Poddar, VP- Research, Broking & Distribution, Motilal Oswal Financial Services
Dabur | Target price: ₹700
Dabur has consistently witnessed higher rural growth than urban regions.
With an improving volume trajectory and no price-cut impact on revenue, the expert expects Dabur’s revenue growth outperformance to be sustained in the near term.
The prediction of La Nina (above-normal monsoon) in FY25 offers hope for a revival in agricultural income and, consequently, the rural economy.
Dabur’s own initiatives around distribution, new launches, and marketing spending will further boost growth.
Poddar expects Dabur’s revenue and PAT to grow at a CAGR of 9 per cent and 13 per cent, respectively, over FY24-26E.
LIC Housing | Target price: ₹930
LIC Housing Finance is making focused efforts to accelerate its disbursement engine and deliver stronger loan growth over FY25-26.
It has invested in technology, marketing, and underwriting over the last one year, to improve its sourcing which would drive better loan growth over FY25-26.
The company has been making targeted efforts at stressed asset resolutions through a combination of auctions as well as pilots on sale to Asset Reconstruction Companies.
Sandeep Raina, Executive Vice President- Research, Nuvama Professional Clients Group
Sky Gold | Target price: ₹3,000
Sky Gold, with its latest acquisition of two companies, has raised its addressable market from 30 per cent to 70 per cent of the total jewellery sales in India.
It deals with the key retail players, Malabar Gold, Kalyan Jewellers, Senco Gold, and Joyalukkas India.
To meet the orders, it has built a manufacturing hub of 81,000 ft.² in Navi-Mumbai.
Raina expects the company’s revenue, EBITDA and PAT to grow 53 per cent, 56 per cent and 67 per cent, respectively, over FY24–27.
Coforge | Target price: ₹7,000
Coforge is one of the most promising mid-cap IT services companies, with all the ingredients to become one of the top 10 global IT services providers.
It is expanding its presence in existing verticals and geographies through multiple acquisitions and a capable management team, aiming to scale up to a $2 billion revenue company.
Raina expects a solid 20 per cent EPS (earnings per share) CAGR.
V2 Retail | Target price: ₹1,002
V2 Retail is in the business of value fashion. It increased its store count to 127 by opening 10 new stores in Q1FY25.
The revenue per square foot increased by 30 per cent YoY to ₹10,642 in FY24 from ₹8,224 in FY23.
Additionally, the same-store sales growth (SSSG) stood at 37 per cent for Q1FY25.
Considering the budget allocation to tier 3 cities such as Bihar, this will eventually ease the convenience of business by attracting cheaper transport and facilities to promote business.
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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.
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