Diwali 2023 picks: GMM Pfaudler, Advanced Enzymes, Automobile Corporation Of Goa, Sudarshan Chemical among Progressive Shares Samvat 2080 ideas

With Samvat 2079 coming to an end, Progressive Shares has picked a bunch of stocks for Samvat 2080. Here's a look at the potential targets and investment rationale behind them. 

Automobile Corporation of Goa  

Fundamental View: 

A. Associate of Tata Motors, maintaining customer stickiness 

B. Enhancement of the overall exports share in the revenue pie 

C. Upgradation of facilities for new models of EV buses 

D. Strong customer base, comfortable balance sheet, robust cash generation Outlook and Recommendations: With the industry sentiments continuing to favour ACGL; the company is set for the next leg of growth that would be contributed via penetration into EVs and hybrid buses, production of higher volumes and overall exports enhancement. We continue to be positive on the stock and maintain the target of Rs1750. 

Technical Outlook: The stock has already given a breakout from Symmetrical Triangle Formation. Indicators are also in the positive zone which confirms the price activity. As per the pattern, the target is Rs1960. 

Also read: Stock recommendations for November 10, 2023: RR Kabel, BHEL and Exide Industries

Advanced Enzyme Technologies  

Fundamental View: A. 1st listed Indian enzyme company with 2nd highest market share B. Well diversified portfolio across the business segments C. High entry barriers (enzyme manufacturing) serve as an added advantage D. Strong margins, robust return ratios and a debt-free status  

Outlook and Recommendations: AETL is a well-known research driven company expanding the enzyme libraries, exploring potential strategic acquisitions, increasing geographical reach, committed towards Innovation and improve the overall margin profile. We continue to be positive on the stock and maintain the target of Rs 380. 

Technical Outlook: In July 2023, the stock gave a convincing close above the zone of Rs297-Rs310, and since then, it has been only giving a pullback move, and at the same time, forming a Bullish Flag and Pole pattern. In the case of a breakout, a sharp uptick can be anticipated. 

GMM Pfaudler  

Fundamental View: A. Strong opportunity pipeline across all business platforms & geographies B. Good order intake with decent growth C. Gradually building capabilities D. Focus on Mixing business to create a global brand  

Outlook and Recommendations: GMMP continues to be a resilient technology leader with a strong brand recall. GMMP continues to leverage its strength of high market share and best in class technology. Going forward, the focus is to generate healthy cash flows, reduce the debt coupled with strong execution plans for the next 4-6 years. We continue to be positive on the stock and maintain target of Rs 2000. 

Technical Outlook: The stock has been oscillating in the Symmetrical Triangle formation; however, the leading oscillator RSI has already given a trendline breakout which indicates that price action will follow suit with time. Post the pattern breakout, one can expect a rally of at least Rs 1000. 

Nelcast  

Fundamental View: A. Strong and distinguished customer base B. Strategic manufacturing locations C. Robust order backlog D. Good prospects in the MHCV space 

Outlook and Recommendations: Nelcast intends to remain a strong focused player for large/medium auto and tractor castings both in India as well as on the global front. It is working on increased production, better capacity utilizations, better Ebitda/kg with minimum capex requirements going forward. We continue to be positive on the stock and maintain the target of Rs 210. 

Technical Outlook: The stock has already given a Rounding Bottom breakout at Rs 110. Indicators are supporting price activity while the secular trend continues to be positive. As per the pattern, the target comes at Rs 195. 

Sadhana Nitrochem 

Fundamental View: A. 2nd plant in the world to manufacture PAP B. Focus on green technology, better margin products C. Broaden the market presence and secure a larger market share D. Become a globally cost competitive manufacturer with focus on R&D 

Outlook and Recommendations: SNCL’s focus continues to remain on R&D and quality processes with strong long-term fundamentals. The recent expansion in the ODB2 production capacity from 550 tons to 2200 tons has started favouring the company. SNCL is looking to expand its supply of products to a broad range of clients and improve the operational matrix. We continue to be positive on the stock and maintain the target of Rs 123. 

Technical Outlook: The stock is forming a Bullish Flag and Pole pattern and the breakout point approximately comes at Rs113. A strong convincing close above the same will confirm the pattern breakout for the target of Rs 180. 

Sudarshan Chemical Industries  

Fundamental View: A. Global presence, with strong R&D capabilities 

B. Trying to increase the share of value added specialty pigments business 

C. China+1 strategy acts as a tailwind for Sudarshan 

D. Improving financials: ROCE, Net working capital, debt reduction Outlook and Recommendations: Higher share of value-added business portfolio and almost the end of the capex plans bodes well to strengthen the cashflows. Product portfolio expansion, optimize cash conversion cycle, debt reduction plans are the key strategies. We continue to be positive on the stock and maintain the target of Rs 600.  

Technical Outlook: The stock is in progress of making an anticipated Bullish Flag and Pole formation. Breakout point for the same arrives at approximately Rs500 and as per the pattern, the target is Rs 660. 

Also read: Hot stocks on November 10: YES Bank, Vodafone Idea, Jubilant FoodWorks, Adani Ports and more                

The Indian Hume Pipe  

Fundamental View: A. Leading player in drainage, irrigation and water supply 

B. Supportive GOI initiatives for water treatment and its management 

C. Land bank monetisation to generate better cash flows 

D. Strong brand recall; healthy order book Outlook and Recommendations: IHP enjoys a strong brand recall. The company is focusing on project completions, and pacing up with newer emerging opportunities. Overall, there is immense scope in infra related activities. Realisations from land parcels would help the company become debt-free over the next 5-6 years. We continue to be positive on the stock and maintain the target of Rs 310. 

Technical Outlook: The stock has given a breakout from the Double Bottom formation, and currently, it is giving a pullback move. A deeper pullback will provide 26.18 opportunity and in that case, risk to reward will be much more favorable for the bulls. As per the pattern breakout, the target arrives at Rs346. 

Also read: Apollo Micro shares jump 7% after strong Q2 results

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