Shares to buy today for short-term: Here are the top five counter picks from the market experts
Experts say counters like Minda Industries Limited, Birla Corporation, ACC Limited, Cadila Healthcare Ltd and Majesco seems promising and investors can think of these stocks before making any investment decision.
After witnessing blood on Dalal Street in Friday, market investors are keeping their finger crossed as to what stock they can pick which would fetch better retursn for them. Our experts find out the following top stocks for you:
1] Minda Industries Limited
Minda Industries has continued its growth streak and reported stellar quarterly performance with 39% YoY revenue growth. EBITDA margin remained flat on sequential basis as increasing premium products demand was offset by rising commodity cost pressure. he group restructuring is expected to complete by 4QFY19 and there will be organic growth only after then, which may also result some softness in revenue growth and margin expansion. The debt has increased due to greenfield capacity and recent group consolidation activity. However, it will be a key focus area for the company and the management will continue to keep D/E under check.
On suggestion for the investors in regard to the auto counter Naveen Kumar Dubey, Research Analyst at the Narnolia Financial Advisors informed in a detailed research report that says, "The counter is fundamentally positive and shows an upside potential for 19 per cent. An investor can take a buy position in the stock and book profit at around Rs 348 per share levels." The counter is oscillating around Rs 292 per stock levels.
2] Birla Corporation
Birla Corporation reported a consolidated EBITDA of Rs 2.07bn against our and the Street’s expectations of Rs 2.20bn and INR 2.17bn, respectively. Revenue increased by 12% YoY to Rs 15.6bn. EBITDA margin expanded 380bp to 13.3% due to higher prices. The company posted an adjusted net profit of Rs 274mn vs a net loss of Rs 218mn in the past year. Consolidated sales volume was up 8% YoY and 5% QoQ at 3.2mn tonnes. In Q3, volume growth shrank because of kiln shutdown at all three integrated plants. Blended cement sales accounts for 89% total sales volumes vs 87% in the previous quarter and 85% in the past year. The company plans to undertake the following measures to bring down cost: 1) setup a 12.25-MW waste heat recovery plant at Maihar in Madhya Pradesh (MP). The plant is expected to come on stream by Q1FY20, 2) setup three solar power plants in three different locations: 11MW plant at Maihar, 3.6MW plant at Chanderia in Rajasthan & 1.2MW plant at Satna in MP, 3) ramp-up production at a captive coal mine at Sial Ghogri in MP, and 4) wagon loading platform at Kudanganj in Uttar Pradesh.
On suggestion for the investors in regard to this counter Ravi Sodah, Analyst at Elara Securities told, "Fundamentals of the counter suggests an upside potential of 67 per cent. An investor can buy the stock for the target of Rs 800 per stock." The counter is revolving around Rs 478 per stock levels.
3] ACC Limited
ACC cement volumes are gradually growing in the past few quarters. In the last quarter, company posted volume growth of 8% YoY. Demand growth of cement is expected to remain in the range of 7-8% for upcoming quarters considering short term headwinds like general elections and slow pace of growth in urban housing sector. The management of the company is bullish on the recent budget which indicates further boost in infrastructure activities (railways, roads, highways and irrigation projects). On the margins front, company’s realization in cement has grown by 2% on YoY basis in the last quarter and lower crude oil price in month of December 2018, helps the company to marginally lower its power and fuel cost. Considering lower crude oil prices, power and freight cost is expected to go down further, which will help the company to control its cost in up-coming quarter. We expect revenue and PAT to grow at CAGR of 10% and 15% respectively over FY18-20e.
On suggestion for the building material counter Aditya Gupta, Analyst at Narnolia Financial Advisors told, "Fundamentals of the counter sugggest an upside potential for 15 per cent. An investor can take a buy position in the stock for target of Rs 1638." The counter is hovering around Rs 1421 per counter levels.
4] Cadila Healthcare Ltd
Cadila reported Q3 results above our estimates, driven by strong growth in the US (up 47% QoQ), boosted by Androgel AG, Asacol HD, and other new launches, coupled with growth from emerging markets (up 14% QoQ). As per management guidance, the strong US pipeline would support its US generics business; management believes there is a lot of scope to improve cost rationalization, supply chain efficiency, and increased productivity. FY20 onward, the next growth driver in the US will be the specialty business. The company is restructuring its domestic business by focusing more on therapies like CVS and Gastro, as the other therapies are stable; it also expects MR efficiency to increase from next quarter onward. We project a margin compression of 100bps YoY to 23.5% for FY19E, mainly due to lower US sales and expect FY20 to be a better year.
On what should be her suggestion in regard to the counter for market investors Sapna Jhawar, Senior Research Analyst - Pharmaceuticals at IndiaNivesh Securities told, "The fundamentals of the stock gives indication of around 34 per cent upside potential. An investor can buy the stock for the target of Rs 433." The counter is currently oscillating around Rs 322 levels.
Majesco delivered decent performance in third quarter both on revenue and margin front. Revenue grew 4.0% QoQ to $35.4mn (against our estimated $35.3mn) led by cloud traction (+51.5% QoQ, 42% of rev) and $1.4mn contribution from Exaxe (organic flat QoQ). Growth in cloud implementation (+17.1% QoQ, 30% of revenue) is offsetting the impact of legacy shrinkage (-16% YoY in 9M). EBITDA margin improved 648bps YoY to 11% (against our estimates of 11.7%) led by growth in higher margin cloud subscription revenue. The 12-month executable order book increased 15.7% QoQ CC to $87.2mn (against $75.4mn QoQ) led by cloud deal wins ( around80% of order book is cloud).
On suggestion in regard to the counter a combined report send by Amit Chandra & Apurva Prasad, Analyst at HDFC Securities conveys that the counter has an upside potential for around 52 per cent. The report suggests market investors to take buy position in the stock for the target of Rs 761. Currently, the stock is oscillating around Rs 498 per counter levels.