Varun Beverages Limited (VBL or the Company) is a significant entity in the beverage sector and one of the largest franchisees of PepsiCo globally (excluding the USA). VBL has partnered with PepsiCo since the 1990s and, over more than 25 years, has strengthened its business relationship with PepsiCo. The company has expanded its licensed territories and sub-territories, diversified the range of PepsiCo beverages produced and distributed, introduced various SKUs into its portfolio, and extended its distribution network
Hindustan Construction is Poised to reclaim last glory: 10-year slog improves financial health. Buy for target price of ₹63 (65% upside): Elara Capital
Once the toast of India’s infrastructure space, Hindustan Construction Company (HCC IN) saw its fortunes wither away post FY11 due to the policy paralysis and delayed decision-making by the government, which also dealt a serious blow to the construction industry. After a decade and a slew of measures, including debt restructuring, dispute settlement and non-core asset monetization, the company is ready to flex its muscles, as India bulks up on large infra opportunity. HCC’s 10-decadeold experience of executing in-house complex & marquee projects, 26% of hydro power capacity and 60% share of India’s civil nuclear power capacity positions it to capture on INR 1.5tn nuclear opportunity
Royal Orchid Hotels’ Higher EBITDA to drive cash flows and deleveraging. Buy for target price of ₹477 (35% upside): Nuvama
We are positive on the sector due to the favourable industry dynamics in the near-to-medium term. A lower base, an extensive room addition pipeline, and better brand recognition will help narrow the valuation gap with its peers. However, we downgrade our FY26 EBITDA/EPS estimate by 16%/22% to account for near term margin pressure on front loading of operating cost and lower fixed cost absorption given the rapid scale up in room inventory and higher repair cost. We revise our TP to INR477 from INR535 earlier, valuing ROHL at 12x FY26E EV/EBITDA. Maintain ‘BUY’
Indian Hotels feels that ARR trajectory is northbound in the medium term. Buy for target price of ₹640 (21% upside): ICICI Securities
Management notes that occupancy and room rates seen in FY24 point to RevPAR growth likely staying healthy in FY25 too. With industry forecasts suggesting double-digit demand CAGR over FY24–28E vs. supply CAGR of 7– 8%, IHCL feels that ARR trajectory is northbound in the medium term. Hence, it remains confident of double-digit consol. revenue growth in FY25 with new businesses expected to grow >30% YoY alongside asset management driving profitability via a mix of premiumisation of offerings and optimisation of costs
Current market environment remains conducive for the business of Pitti Engineering Ltd. Buy for target price of ₹1180 (37% upside): Axis Securities
We maintain our BUY rating on the stock with a revised TP at Rs 1,180/share, implying an upside of 37% from the CMP. We believe the current market environment remains conducive for the business and the dilution of equity (around 35 Lc shares to be added) is unlikely to impact the valuation significantly.
Equity Investment Strategy Post Lok sabha Election 2024 by Axis Securities
With this development, the volatility in the domestic market is likely to remain on the higher side for some time. Against this backdrop, the market positioning is likely to shift towards Quality and Low Volatility stocks with some tilt towards defensive names. Based on this development, the money may flow towards Largecaps in the near term. Hence, we recommend investors to remain invested in the market and use yesterday’s dip to build a position in high-quality companies (where the earnings visibility is quite high) with an investment horizon of 12-18 months
Neogen Chemicals’ Battery materials is a growth engine. Buy for target price of ₹1936 (30% upside): HDFC Securities
Neogen Chemicals’ (NCL’s) earnings will grow at a CAGR of 43% over FY24- 30E while RoE will improve from 6% in FY24 to 23% in FY30E. New-age chemicals from its battery material business will drive growth
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