In our base case, we roll over the Nifty target to Mar’25 to 24,600 by valuing it at 20x on Mar’26 earnings. While the medium to long-term outlook for the overall market remains positive, we may see volatility in the short run with the market responding in either direction. Keeping this in view, the current setup is a ‘Buy on Dips’ market
We present hereunder a table of companies (CNX 500 stocks) that offer dividend yield of 3.00% and above
In our Sobha (SDL) deep dive note ‘R’eset, ‘R’estart, ‘R’efocus = ‘R’erating, we had premised our investment thesis on a strong demand undercurrent in the Bengaluru market and SDL hitting the Reset-Restart button. Since then, the stock has more than trebled (3.4x), business development has taken a big leap, and the launch pipeline has fattened.
We expect a 16% earnings CAGR for MANKIND over FY24-27. Considering its strong brand visibility, sustainable earning growth and superior return ratios, we value MANKIND at 40x12M forward earnings (30% premium to the Healthcare sector PE) to arrive at a TP of INR2,650.
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
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
Company’s operational and financial performance to improve significantly in the coming period. We estimate revenue, EBITDA and PAT to grow at ~9%, ~21% and ~51% CAGR respectively over FY24-26E. Net debt/EBITDA (2.1x in FY24 vs 4.8x in FY23) is expected to come down further to 1x by FY26E
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’
We initiate Jyothy Labs (JYL) with a high conviction BUY idea, with a TP of Rs 575 (40x June-26 EPS), as it is one of the few FMCG companies structurally poised for high single-digit volume growth, mid-teen EBITDA growth, and high-teen net income growth.
The dividend yield is computed based on the closing price of 5 th June 2024. We have considered companies that have consistently paid dividend in the last 3 years – i.e FY23/CY22, FY22/CY21 and FY21/CY20.
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