Brokerage Favourite Stocks: Earning season for the March quarter continues. Results from leading IT, bank and NBFC, FMCG and auto companies are coming. Talking about the results so far, these have been mixed, but they are going to raise hopes. Among IT companies, TCS and Infosys have performed better. The guidance that Infosys has kept is very positive. Similarly, the results of ICICI Bank, Axis Bank and Bajaj Finance from the banking and NBFC sectors have been better, although HDFC Bank’s results have not been predictable. Currently, since the results of the companies, brokerage houses are forming their opinion about the stock. Some stocks have been included in his list of choices and he has advised to invest in them. Let’s know the list of shares… ..
Private sector Axis Bank has turned profitable from losses. The bank made a profit of Rs 2677 crore in the March quarter, which is the highest in any quarter so far. The bank had a loss of Rs 1387.8 crore in the same quarter last year. In the March quarter, the bank’s net income also grew by 11 percent to Rs 7555 crore on an annual basis. Provisions and contingencies declined by 58 per cent to Rs 3295 crore from Rs 7730 crore a year ago. On a yearly basis, there has been a strong growth of 12 per cent in the bank’s loan book and 8 per cent on a quarterly basis. During this period, the corporate loans of the bank increased by 16 percent and retail loans by 11 percent.
Brokerage house CLSA has decided to increase the share target to Rs 1025 by recommending Axis Bank buyout. The current price of Axis Bank shares is around 700 rupees. In this context, it can get 46 percent return.
After the quarterly results, brokerage house Credit Suisse has given an outperform rating on Infosys and raised the share target to Rs 1810. The current price of the share is Rs 1350. In this context, the stock can get 34 percent return. The company’s net profit during the March quarter increased by 17 per cent to Rs 5076 crore on an annual basis. Revenue growth in the CC term has been 2 per cent on a quarterly basis. USD revenue growth was 2.8 percent during this period.
However, EBIT margin fell 90bp to 24.5 per cent. Operating profit of the company decreased by 2.3 per cent. The positive is that for FY 2021-22, Infosys has kept a revenue growth guidance of 12 to 14 percent on the basis of Constant Currency (CC). The company has announced its EBIT margin growth forecast of 22 to 24 per cent for the coming business year.
ICICI Bank has shown growth in every segment in retail, SME and corporate portfolios in the March quarter. Core operating performance was also strong. However, there has been some impact on profits from muted income and treasury losses. There has been a significant improvement in the asset quality of the bank, which is the most positive factor. Restructured loans have been 0.5 per cent of the total loans. The standalone profit of the bank increased by about 260.5 per cent to Rs 4,402.61 crore. There was growth in net interest income and other income.
Brokerage house Motilal Oswal has fixed a target of Rs 750, recommending buying in the stock. Brokerage house CLSA has also advised buying on ICICI Bank and has fixed a target of Rs 825 for the stock. Current price is around 600 rupees. In this context, the stock can get 37 percent return.
Bajaj Finance’s profit grew 42 per cent year-on-year to Rs 1347 crore in the March quarter. Net interest income has come down marginally and has been Rs 4659 crore. The company has announced a dividend of Rs 10 per share on a face value of Rs 2. The expenditure on loan loss and provisioning stood at Rs 1231 crore in the fourth quarter, which supported the profit. The gross NPA came down to 1.79 per cent, while the NPA came down to 0.75 per cent.
Brokerage house Motilal Oswal has set a target of Rs 5865, while recommending to buy the stock. Tuesday’s closing price of Rs 4873 can give a further 20 per cent return in this. At the same time, brokerage house Morgan Stanley has given an overweight rating on Bajaj Finance and has set a target of Rs 6000. In terms of current price, it can get 23 percent return.
(Note- We have given advice here based on the company’s quarterly results and brokerage house report. Considering the risk of the market, take the opinion of the first expert on the investment.)