Brokerages initiate coverage on 7 stocks with up to 48% upside

ICICI Securities initiated coverage on Five-Star Business Finance with a ‘buy’ rating. The brokerage firm set a target price of Rs 765 on the stock, which shows an upside potential of 17% from the current market prices.

"Five Star, with a two-decade-long experience in self-employed business loans, well-diversified borrowing profile, strong pricing power and stable management team, is likely to emerge as a preferred player to gain exposure to India’s financial inclusion story," it said.

Kotak Securities initiated coverage on Mahindra Holidays & Resorts with a ‘buy’ rating. The brokerage firm set a target price of Rs 370 on the stock, which shows an upside potential of 25% from the current market prices.

"We expect MHRIL’s revenue and PAT to grow at a CAGR of 13.7% and 20.7% respectively in FY23-25E led by a pickup in member additions on the addition of new inventories, contribution from long tenure products and higher upgrades positively impacting AUR and growing share of resort income," it said.

Jefferies initiated coverage on JB Chemicals & Pharmaceuticals with a ‘buy’ rating. The brokerage firm set a target price of Rs 2,680 on the stock, which implies an upside potential of 14% from the current market prices.

"JB Chemicals (JB) is the fastest growing domestic pharma company with therapy dominance in cardiac and gastro. Life cycle management of key brands, synergistic acquisitions and targeted new launches should allow JB to outperform industry growth. Export growth will be led by contract manufacturing of Lozenges where it has strong customer relationships and technology," it said.

Antique initiated coverage on Titagarh Rail Systems (TRSL) with a ‘buy’ rating. The brokerage firm set a target price of Rs 694 on the stock, which indicates an upside potential of 46% from the current market prices.

"We expect TRSL to post earnings CAGR of 53% over FY23-26E, and generate an average RoE of +25%. TRSL's stock has meaningfully appreciated in the past year, led by a nearly doubling of profit in FY23. Yet, at 12x FY25E earnings, the stock is cheap and does not capture TRSL's long-term growth potential," it said.

Systematix initiated coverage on Piramal Enterprises with a ‘buy’ rating. The brokerage firm set a target price of Rs 1,026 on the stock, which shows an upside potential of 8% from the current market prices.

"PEL is strategically expanding its unsecured lending business by partnering with leading Fintech and Consumer Tech companies. This move aims to tap into the highly profitable digital lending sector, offering an attractive yield of 18% on advances and a robust return on assets (ROA) of around 5%," it said.

Incred Equities initiated coverage on HEG with an ‘add’ rating. The brokerage firm set a target price of Rs 2,462 on the stock, which indicates an upside potential of 48% from the current market prices.

"HEG is likely to register a 6% volume CAGR over FY24F-26F, and in the meantime, its RoE is expected to rise from 8.6% in FY23 to 12.2% in FY25F. Moreover, there was no capex addition by the global peers of HEG in the last decade, barring HEG itself which increased the capacity of its graphite plant from 80,000mt to 100,000mt, making it the single-largest graphite plant in the world," it said.

Keynote Capitals initiated coverage on Sheela Foam with a ‘buy’ rating. The brokerage firm set a target price of Rs 1,311 on the stock, which shows an upside potential of 12% from the current market prices.

"The growth drivers include emerging Indian B2B opportunities, B2C and D2C product launches, expansion in the Australian furniture and mattress industry, and increased exports from Spain to the USA. To leverage the prospects, the Company laid capex worth Rs 3.5 billion, guided to be operational by H1 FY24," it said.

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