Stock Tips: The market had reached a record high on Monday last week, but since then it has been in a downward trend. After the announcement of financial results for the September 2021 quarter, profit-booking started in IT stocks, which increased the pressure on the market. The market is still under pressure and there is selling pressure in IT and auto stocks. Talking about individual stocks, investors can earn up to 25 percent profit by investing in ACC and ICICI Prudential Life.
ACC- BUY (Friday closing price on Nifty – Rs 2213)
- ACC’s cost management was better as compared to Pierce. Due to this, the company’s freight charges fell by 2.6 per cent on a quarterly basis in July-September 2021, despite the costlier diesel. The costlier oil could impact this further but brokerage firm Edelweiss estimates that the company will do better. Management will be successful. According to experts, it is mainly dependent on domestic coal around 40-45 per cent.
- In July-September 2021, the company’s EBITDA increased by nearly 6 per cent to Rs 710 crore on a year-on-year basis. However, due to weak prices and expensive oil, it declined by about 19 percent on a quarterly basis.
- According to experts, ACC can get the most benefit of recovery in demand after a good monsoon.
- According to Edelweiss, its current valuation of 10x CY22e EV/EBITDA is very attractive for investment. Experts have given investment advice in this at a target price of Rs 2696.
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ICICI Prudential Life- BUY (Nifty closed on Friday – Rs. 620.90)
- ICICI Prudential Life’s VNB growth stood at 28 per cent year-on-year in the second quarter of the current financial year 2021-22. The main reason for this was shifting the business mix to low base, new partnerships and ICICI Bank. VNB means increase in EV (Enterprise Value) over a period from new business.
- The company’s APE (Annual Premium Equivalent) growth was also good due to the rise in ULIPs, which is very important for VNB. ICICI Pru’s annual APE growth stood at 35 per cent in the July-September quarter. According to Kotak Institutional Equities, the share of ULIPs will increase on the back of strong capital market and high APE growth.
- The company spent Rs 850-900 crore in the first half of April-September 2021 regarding the COVID claim. However, according to analysts, higher investments in the first half and a 54 per cent strength in the Nifty 50 helped neutralize the impact of spending on account of COVID claims.
- According to analysts at Kotak Institutional Equities, its growth prospects look good due to its diversified product portfolio and new partnerships. Analysts have given buy advice in its shares at a fair value of Rs 775. .
(The stock recommendations given in the story are those of the respective research analysts and brokerage firms. Financial Express Online takes no responsibility for the same. Investments in capital markets are subject to risks. Please consult your advisor before investing.)
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