IDFC First Bank, M&M, TVS Motor, Syrma SGS And More - Top Stock Picks For Diwali, Samvat 2080 By Anand Rathi

Anand Rathi Report

Here are the top stocks to 'Buy' for Samvat 2080 handpicked by us-

IDFC First Bank Ltd. (The upside potential is 37% from current market price.)

IDFC First Bank has undergone the first phase of its transformation from an infra financier to a granular retail lending bank. Investment in technology and building a scalable liability franchisee would keep costs high in the near term, despite strong granular loan growth.

The bank expects the credit card business to breakeven by FY25. 24-25% of the credit card mix are revolvers. IDFC First Bank expects to reach 13-15% return on equity by FY25 and 1.4-1.6% return on asset by FY25.

We assign a 'Buy' rating on the stock with a target price of Rs 114 per share.

Mahindra and Mahindra Ltd. (The upside potential is 18% from current market price.)

M&M has been the dominant market leader in the domestic tractor market, commanding a market share of 42.9% in Q1 FY24 (41.2% in FY23). With its offerings across different brands of Mahindra, Swaraj, Trakstar and soon to be launched Oja and its well-entrenched sales and service network, it is expected to maintain its leadership position going forward as well.

The introduction of new range of OJA tractors is expected to boost its topline in the future.

We assign a 'Buy' rating on the stock with a target price of Rs 1,770 per share.

Syrma SGS Technology Ltd. (The upside potential is 20% from current market price.)

The company has a total order book of ~Rs 35,000 million, with Rs 22,000-23,000 million expected to be delivered in the next 12 months. The company has done a capex of Rs 500 million in the Q1 FY24 and plans to spend Rs 2,000-2,500 million in total for the year.

Syrma can be a key player in the growing ESDM industry (especially in the original design manufacturing segment) if it grabs the opportunities available across end-user industries and executes well on the burgeoning order inflows.

We assign a 'Buy' rating on the stock with a target price of Rs 735 per share.

TVS Motor Company Ltd. (The upside potential is 15% from current market price.)

TVS Motor has been able to expand its presence beyond the South and currently has a significant presence in all the regions, in terms of sales. The efforts taken over the years to improve its pan-India dealer network have resulted in having a domestic presence.

Company is poised to outperform the industry on the back of new product launches in ICE and electric vehicle segments, higher focus on exports and premiumization, operating leverage, benign input prices and price hikes.

We assign 'Buy' rating on the stock with a target price of Rs 1,850 per share.

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