Shares to buy today: Here are the stocks that you can think of, say experts

After heavy sell-off pressure on Monday trading witnessing around 1 per cent loss at the Indian indices, traders are watching at the Indian bourses with their fingers crossed as Nifty below 10,680 mark conveys bearish trend, says majority of the equity analysts. So, in such a scenario, traders are advised to go with the fundamentals of the company rather the technicals. So, here are the top picks of various experts that market investors can think of while investing:

Mphasis

Mphasis (MPHL IN) revenue was in line with our estimate at $282.7mn, up 2.6 per cent QoQ and 3.1 per cent QoQ, in CC terms. Our key concern remains the narrow bucket of clients driving growth (refer to our report on India IT Services mid-cap firms “Structural Makeover” on 2 January 2019). 

Commenting upon the company's fundamentals Ravi Menon, Equity Analyst at Elara Securities told Zee Business online, "Incremental revenue contribution YoY remains concentrated with 94 per cent coming from Top 5 clients (30 per cent form Top 1, 64 per cent from top 2-5) while top 6-10 clients declined 3 per cent. BFSI, despite being the largest and the declared focus vertical, continues to contribute the lowest incremental revenue at a mere USD 5.8mn YoY (18.6 per cent of incremental revenue YoY, 32.2 per cent even adjusted for Digital Risk decline) while emerging industry added the highest at $13.9mn YoY (45 per cent of incremental revenue YoY) and IT, communications & entertainment added $11.4mn YoY (37 per cent). We are concerned about sustainability of growth. 

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On what he recommends to the markt investors in regard to Mphasis stock Ravi Menon of Elara Securities told, "We recommend traders to sell the stock at current market price i.e. around Rs 921 for a target price of Rs 850 per share mark, a downside profit of around 8 per cent."

Swaraj Engines

Although, tractor industry (Domestic + Export) grew 15 per cent YoY in YTD FY19, we expect growth rate to moderate in coming months owing to drought situation in few states and 3 per cent fall in Rabi showing on account of depleting water resources in certain regions. 

Speaking on the fundamentals of Swaraj Engine stock Abhishek Jain, Analyst at HDFC Securities told, "Swaraj Engines Ltd (SEL)’s 3QFY19 revenue was in line with estimate (Rs 1.99bn, +8 per cent YoY) while operating margin saw a dip of 17bps YoY/-241bps QoQ to 13.8 per cent owing to 104bps contraction in gross margin. APAT stood at Rs 173mn (flat YoY). Engine volumes grew by 2.7 per cent YoY to 22.569k units while tractor sales at the parent level (M&M) were at 90.72k units (+11 per cent YoY). During 9MFY19, M&M’s tractor production grew by 9 per cent YoY and sales grew 8.5 per cent, inventory is at normal level." 

Asked about his suggestion to the investors in regard to this stock Abhishek Jain of HDFC Securities said, "As growth drivers of the stock are intact, we recommend investors to buy Swaraj Engines for the target price of Rs 1,828 per share levels." The stock closed at Rs 1,502 per share on Monday.

M&M Financials

Despite the slowdown in the auto sales in the industry, AUM growth of M&MFIN remained strong on account of rural based geographical expansion and increasing relationship with various OEMs. 

Commenting upon the stock outlook Deepak Kumar, Research Analyst at Naranolia Financial Adisors told, "We expect strong infra/construction activity and improving rural economy will aid growth going ahead. Improvement in the rural cash flow has helped the asset quality to improve sequentially. NIM has remained under pressure due to excess liquidity & management inability to pass on the entire rise on the cost front to the customer. Going ahead we expect NIM pressure to taper down with rising share pre-owned vehicle in the portfolio. The OPEX is expected to remain elevated as management plans to continue investment in branch & employee front in FY19. Management expects increase in branches to drive loan growth & collection efficiency going ahead, with increasing proximity to the customers. Management has guided credit cost to decline by 25bps going ahead. The stock is currently trading at 2.2x BVPS FY20e."

On his suggestion for the traders Deepak Kumar said, "Due to recent correction in stock price, we up-grade the stock from HOLD to ACCUMULATE with unchanged target price of Rs 469." Current market price of the stock is Rs 417.

Maruti Suzuki

Maruti’s 3QFY19 results (PAT of Rs 14.9B, -17 per cent YoY) disappointed as EBITDA margins came in at 9.8 per cent (which was significantly below estimates). The OEM offered higher discounts towards the year end to normalize channel inventory, post a weak festive season. Thus, discounts increased to Rs 24.3K in 3Q (from Rs 18.7K QoQ,). Margins were also impacted by a combination of adverse factors including higher Commodity prices (80bps QoQ) and FX impact(30bps), one time gratuity provision of Rs 480m and higher marketing spends.

Speaking on the stock Aditya Makharia, Analyst at HDFC Securities told, "We believe Maruti remains well positioned in the passenger car segment with a broad based product portfolio as well as a diversified geog raphic presence (rural is  around 39 per cent of sales). The management is confident of growing ahead of the industry, driven by product refreshes and its dominant network. We are lowering our earnings estimates by  around 11 per ent over FY19-21E to factor in the weaker 3Q results."

On his suggestion to the investors Aditya Makharia of HDFC Securities told, "We recommend invetors to buy the stock for the target price of Rs 7,400." The stock closed at Rs 6,516 on Monday.