Domestic brokerage and research firm Axis Securities continues its positive long-term outlook on the market, backed by a favorable structure to improve credit growth to banks raising capex.
The brokerage has maintained its Nifty March 2023 target at 18,400, which is valued at 22x FY24 earnings versus 20x earlier. “We cut the Nifty multiple to accommodate the rising interest rate scenario. We believe that though aggressive policy tightening will help in easing inflationary pressures, continued rise in oil and commodity prices will continue to pose challenges to the market in the next few quarters.
Current India VIX is trading around LTA levels and a clear trend is likely to emerge only if volatility remains at lower levels for a prolonged period. Considering these developments and overall weak global cues, the brokerage expects the market to remain moderate in the near future.
Based on the above themes, Axis Securities top stock picks ICICI Bank is with a buy rating with a target price of 1,000, Bajaj Auto (TP: 4,200), Tech Mahindra (TP: 1,700), Maruti Suzuki India (TP: 9,800), State Bank of India or SBI (TP: 665), Bharti Airtel (TP: 900), Cipla (TP: 1,125).
Federal Bank (TP: 115), Varun Beverages (TP: 880), Ashok Leyland (TP: 164), Astral Limited (India) (TP: 1,900), Bata India (TP: 2,200), APL Apollo Tubes (TP: 1,100), Healthcare Global Enterprises (TP: 330), Praj Industries (TP: 477), CCL Products (India) (TP: 560) are also part of its top recommendations.
“The cumulative net profit of NSE 500 Cosmos for the last 4 quarters reached an all-time high (Par.) 9.5 LC cr in Q4FY22). Financials, Oil & Gas, Metals and IT are now contributing 70% to the profitability of the NSE 500. We see FY13/24 Nifty EPS at 826/920, unchanged by 2%/respectively after the Q4FY22 earnings season. Our estimates are on the conservative side and 9% below consensus estimates,” the note added.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.