Posts in category investments

Azad Engineering stands at an interesting juncture & has a long runway ahead. Buy for target price of ₹2450 (49% upside): ICICI Securities

We believe Azad stands at an interesting juncture where a massive TAM is complemented by an upcoming 95,000m2 facility. The comparison with engine products division shows that a company with 80x revenue can also record EBITDA growth of 31% and record EBITDA margin of 31.2%. Hence, we believe Azad’s journey has just begun, particularly in view of its existing customer base and potential. Besides, the adjacent opportunities in nuclear power and ATGG engines are a plus. We maintain BUY on Azad with DCF-based unchanged TP of INR 2,450

Sobha provides strong growth visibility by unlocking its vast land reserves. Buy for target price of ₹2250 (32% upside): Motilal Oswal

Sobha continues to provide strong growth visibility by unlocking its vast land reserves. Additionally, the ongoing fund raise and strong cash flows will enable the company to focus on new land acquisitions, which will further enhance its growth pipeline

JB Chemicals is well-positioned to capitalize on immediate growth opportunities. Buy for target price of ₹2215 (15% upside): SMIFS

JB Chemicals’ (JBCP) Q1FY25 revenue growth was largely in line with our estimates. Slightly higher than-expected revenue from the domestic business and improved gross margins resulted in expansion of EBITDA margins. Revenue witnessed growth of 12% YoY and 17% QoQ to ~Rs10Bn. The YoY increase was mainly driven by 22% YoY growth in the domestic formulations business whereas flat growth witnessed in the overall export business.

Sansera Engineering is on-track to achieve strong growth. Buy for target price of ₹1700 (22% upside): Nirmal Bang

Sansera Engineering (SANSERA) posted its highest ever consolidated revenue in 1QFY25 at ~Rs7.44bn, up ~13%/flat YoY/QoQ. Consolidated gross margin stood at 41.8% up by ~190bps YoY. EBITDA stood at ~Rs1.28bn and margin came in at 17.1%. GM expansion was offset by higher other expenses due to an increase in global freight rates and higher staff costs due to annual hikes incorporated in the quarter

Eureka Forbes is progressing well across parameters of growth, margin and cash generation. Buy for target price of ₹590 (26% upside): ICICI Securities

We note Eureka is progressing well across parameters of – growth, margin and cash generation. We remain constructive on Eureka following strong business tailwinds. Maintain BUY with DCF-based revised TP of INR 590 (implied P/E of 65x on FY26E EPS)

NCC is a key beneficiary of the tailwinds in the buildings, roads, water, mining and electrical segments. Buy for target price of ₹400 (25% upside): ICICI DIrect

NCC is one of the leading construction companies with presence across varied verticals such as buildings, roads, water, mining and electrical. Standalone order book is at ₹ 47,625 crore, 2.5x TTM book to bill.

BLSIN’s Q1FY25 performance exceeded expectations, with multiple triggers poised to drive future growth. Buy for target price of ₹518 (34% upside): Nuvama

BLSIN’s Q1FY25 performance exceeded our expectations, with multiple triggers poised to drive future growth. It is the only listed Indian company in global visa processing and G2C services outsourcing. It operates on an asset and capital-light model, thus ensuring strong cash generation, with minimal growth-related costs. New visa contracts and expansion in digital services across India are expected to boost BC revenue and profitability. The company has a history of acquisitions that have enhanced its offerings and market entry. The management plans to raise INR2,000cr via equity, despite sitting on a strong cash balance, for further acquisitions and to accelerate growth in the medium to long term. Despite a higher-than-expected earnings performance in Q1, we keep our FY25/FY26 estimates unchanged. We expect a robust revenue/EPS CAGR of 30%/35% over FY24–26E. We retain ‘BUY’ with a SoTP-based TP of INR518

Coal India Ltd is well poised for profitable growth. Buy for target price of ₹650 (27% upside): ICICI Direct

We maintain a positive view on Coal India amidst healthy volume growth on the anvil, its diversification efforts in new sunrise spaces, healthy net cash positive b/s and robust dividend yield (~5%). We assign BUY rating to Coal India with target price of ₹650 i.e. 5.5x EV/EBITDA on FY26E

Amara Raja is doubling down on EVs, with lithium cell plants for NMC/ LFP chemistries slated to come on stream in FY26E/28E. Buy for target price of ₹1980 (31% upside): Nuvama

Amara Raja is doubling down on EVs, with lithium cell plants for NMC/ LFP chemistries slated to come on stream in FY26E/28E and investments in Inobat/Log9 entities. These efforts enhance long-term growth visibility. Retain ‘BUY’ with a TP of INR1,980 (INR2,040 earlier), based on 15x Sep-26E EPS for the core business, 3x PB for lithium battery investments and INR23/share for Inobat/Log9 investments

Dhanuka Agritech has seen strong rebound in performance & upgraded the guidance for FY25. Buy for target price of ₹2223 (21% upside): SBI Securities

At the current price, the stock is trading at P/E multiple of 28.0x/24.1x of its FY25E/FY26E earnings respectively. The company has announced Rs 100 cr buyback at the maximum price of Rs 2,000 per share. The promoters will also be participating in buyback process. We maintained our buy rating on the stock with upgraded price target of Rs 2,223/- thus providing an upside potential of 21%.