BackStocks to buy: Axis Bank, Dr Lal Pathlabs among top four stock picks by SMC Global Securities for this week
Stocks to buy: Domestic brokerage SMC Global Securities has recommended four stocks to buy this week based upon the fundamental and technical analysis in the current market scenario
PremiumStock market today: Indian stock market benchmarks consolidated for the second consecutive session on Tuesday, June 11, amid weak global cues.Despite opening higher and trading in positive territory for a significant part of the session, equity benchmarks—Sensex and Nifty 50—ended flat on profit booking in the absence of fresh triggers.
Sensex hit its intraday high of 76,860.53, but prey to profit booking in the fag-end and ended 33 points, or 0.04 per cent, lower at 76,456.59. Nifty 50 opened at 23,283.75 against its previous close of 23,259.20 and touched its intraday high of 23,389.45. The index settled 6 points, or 0.02 per cent, up at 23,264.85.
Caution ahead of the US consumer price inflation data and US Federal Reserve policy decision on Wednesday also contributed to the market's lacklustre show.
After rising about 3.4 per cent last week, Nifty 50 has dropped 0.1 per cent this week so far, trading in a narrow 200-point range in the last two sessions. The frontline indices hit their all-time high levels in the early trade on Monday.
In the current market scenario, domestic brokerage firm SMC Global Securities has released its top four stock picks for this week. The brokerage has selected the quality stocks on technical as well as fundamental parameters. The stocks have robust fundamentals and are well-placed to yield good returns for investors in the next one-year time frame, according to the brokerage.
Weekly Stock Picks by SMC Global Securities
Let's take a look at the top four technical and fundamental stocks for this week by brokerage SMC Global Securities:
1. Axis Bank: Current Market Price (CMP): ₹1,193.85; Target Price: ₹1,376 Upside: 16 per cent
Axis Bank reported a net profit of ₹7,130 crore in the January-March quarter results for fiscal 2023-24 (Q4FY24), compared to a loss of ₹5,728.4 crore in the corresponding period last year. The private sector lender's net interest income (NII)-the difference between interest earned and paid-rose 11.5 per cent year-on-year (YoY) to ₹13,089 crore, compared to ₹11,742 crore in the year-ago period.
The bank is well capitalized with adequate liquidity buffers for future growth. Improving asset quality and a strong position in payments and digital banking indicate future growth visibility, according to SMC Global Securities.
According to the bank's management, its GPS (Growth, Profitability and Sustainability) agenda is on track over steady growth for all the major business verticals of the bank. Economic slowdown and decline in asset quality are key risks to the bank's growth trajectory.
The brokerage expects that the stock will see a price target of Rs. 1,376 in 8-10 months time frame on expected P/BV of 2.40x and FY25 BVPS of Rs. 573.42.
2. Zydus Lifesciences CMP: ₹1,058.45; Target Price: ₹1,273; Upside: 20 per cent
Zydus Lifesciences' revenue rose 10 per cent to ₹5,533.8 crore in Q4FY24. The EBITDA for the quarter was Rs. 1,630.5 crore, up 30 per cent YoY. EBITDA margin for the quarter stood at 29.5 per cent, an improvement of 440 bps on a YoY basis. The net profit for the quarter was Rs. 1,182.3 crore, up 299 per cent YoY. In FY25, the management expects high teens growth and maintain EBITDA margins of 27.5 per cent.
The company`s diversified portfolio of products and focused execution efforts would help achieve sustain healthy growth. The new product launches and robust pipeline of launches along with market share gain in the Indian formulation business auger well for the company, according to SMC Global Securities.
The brokerage expects that the stock will see a price target of Rs. 1,273 in 8-10 months time frame on a current P/BVx of 5.37x and FY25 BVPS of Rs. 236.98.
3.Dr Lal Pathlabs Ltd
The 200 days exponential moving average (DEMA) of the stock on the daily chart is currently at 2,401. On the weekly chart, the stock rebounded after breaching its 200-day exponential moving average (EMA) and is now trading above this key indicator. It has also broken through a trend line resistance and is sustaining above it, indicating strong upward momentum.
Additionally, the stock observed a rectangle pattern breakout on the weekly chart, which is a bullish signal. These technical indicators suggest further gains in the upcoming sessions, signaling potential upside momentum.
‘’It is advisable to consider buying the stock on any dips within the range of 2785-2800 levels, targeting an upside potential of 3180-3200 levels, with a stop loss below 2600 levels,'' said SMC Global Securities.
4.Oberoi Realty
The 200 days DEMA of the stock on the daily chart is currently at 1,392. On the weekly chart, the stock has formed a pattern of higher highs and higher lows, indicating an uptrend. It consistently trades above its 200-day EMA, supporting this positive trend.
Additionally, a bullish pennant pattern breakout is observed, suggesting further upward momentum. These technical indicators collectively suggest potential gains for the stock in the near future. ‘’Consequently, one may consider buying the stock within the range of 1,885-1,900 levels, targeting upside levels of 2,170-2,180, with a stop-loss below 1,760 levels,'' said SMC Global Securities.
Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.
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