HDFC Bank Ltd, Reliance Industries Ltd (RIL), Hindustan Unilever Ltd (HUL), Kotak Mahindra Bank Ltd and UPL Ltd are five Nifty stocks which are trading near their 52-week low levels, even as their average share price targets suggest 14-32 per cent upside potential.
HDFC Bank shares were 1.1 per cent away from October 26 low of Rs 1,460.55. UPL shares hit 52-week low of Rs 528.35 on Tuesday. HUL shares are a mere 3 per cent away from March low of Rs 2,393. Shares of Reliance Industries and Kotak Mahindra Bank were also just 4-6 per cent away from hitting their one-year lows, as of latest close.
HDFC Bank's average target price of Rs 1,951, as per publicly available Trendlyne, suggests a 32 per cent potential upside over the prevailing price. UPL's average target of Rs 704 suggests 30 per cent upside potential. A target of Rs 2,775 for RIL suggests 21 per cent upside potential, Kotak's average target suggests a 20 per cent potential upside while HUL's target of Rs 2,835 hint at 14 per cent upside.
A few of these corporates have already reported earnings for the second quarter. Reliance Industries' beat analyst estimates on profitability, following which ICICI Securities suggested has a target of Rs 2,585 on the stock. Prabhudas Lilladher sees the stock at 2,618; Nuvama Institutional Equities finds it worth Rs 2,950. Nomura India suggeted a target of Rs 2,925 as it maintained its "Buy' call on the stock. Jefferies, on the other hand, increased its target price for Mukesh Ambani-led company to Rs 3,000 against Rs 2,095 earlier. Macquarie upped its target on the stock to Rs 2,200 against Rs 2,100 earlier.
"F25e P/E of 18.8 times is a 26 per cent discount to peers and 10 per cent below its five-year average, despite improving ROCE. The stock implies below mid-cycle energy earnings and no upside from wireless broadband plans. As net debt peaks and monetisation of $35bn capex picks up, we see attractive risk-reward," Morgan Stanley said last week.
HDFC Bank's results impressed analysts but there remains concerns regarding near-term impact of the HDFC merger on financial ratios. Risk-reward on the counter stays attractive, analysts said.
In the case of Kotak Mahindra Bank, the Q2 results were in-line with Street exepctations but the appointment of an external CEO is seen as a nea-term overhang. Motilal Oswal suggeted a 'Neutral' rating on the stock with a share price target of Rs 1,900. Nirmal Bang sees the stock at Rs 2,182.
"We cut target price multiple to 2.6 times September 2025 ABV from 2.8 times June 2025 ABV for the core bank and value the subsidiary at Rs 480/share, leading to target price of Rs 1,955 per share (earlier Rs 2,000) for KMB. We retain HOLD on the stock," Emkay Global said.
In the case of HUL Q2 results, ICICI Secuties said: "Adjusted revenue growth was soft at 3 per cent YoY, primarily led by volume growth while price growth remained flat. Rural continues to underperform urban. Home care revenue performance has subsided to 3 per cent YoY value growth. Revenue growth in BPC and Food also remained soft. However, while volume growth in BPC stood at 5 per cent, it has declined by 5 per cent in Food. Maintain ADD."
In the case of UPL, citing bleak demand environment globally coupled with pressure on realizations & margins, the company has revised downward its revenue growth guidance to flat growth YoY (earlier 1-5 per cent. The company suggested nil to minus 5 per cent Ebitda growth (earlier 3-7 per cent) in FY24E.
"Company has highlighted that the gross debt is expected to come down by $500 million in FY24E. We expect Revenue/PAT CAGR of 8 per cent/22 per cent over FY24-26E. Maintain HOLD with revised target of Rs 550 (earlier Rs 650) based on 10 times FY26E EPS.
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