Atul, KSB, Niva Bupa among 8 stock saw brokerage initiations with up to 38% upside

Select stocks including Suraj Estate Developers, Hindustan Foods, Niva Bupa Health Insurance, Atul, KSB, Dr Agarwal's Health Care, Deepak Nitrite and Jyoti CNC Automation have seen fresh interest from the various brokerage firms, who have recently initiated their coverage on these companies.

The host of brokerages including Anand Rathi Shares & Stock Brokers, Systematix Institutional Equities, Motilal Oswal Financial Services, Emkay Global Financial Services, Equirus Securities, Kotak Institutional Equities and ICICI Securities have launched their maiden reports on these stocks with an upside potential of 38 per cent. Here's what brokerage said on these stocks:

Anand Rathi Shares & Stock Brokers on Suraj Estate Developers
Rating: Buy | Target Price: Rs 442 | Upside Potential: 38%
Its choice of micro-markets and differentiated products make Suraj Estate stand out. On its long-standing operations in south-central Mumbai, cost and time effective redevelopment model, keen focus on the value-luxury category and select luxury developments, it has emerged as a real estate supplier of choice in its chosen markets, said Anand Rathi in its IC report.

"Well-established in SCM with expertise in redevelopment of tenanted properties, the company is set to benefit from the paucity of vacant land in SCM. Further, on its right-product positioning, a strong pipeline and leading EBITDA margins, premium valuations are expected for the company due to the growth potential and strong management," it said with a 'buy' tag and a target price of Rs 442.

Systematix Institutional Equities on Hindustan Foods
Rating: Buy | Target Price: Rs 710 | Upside Potential: 25%
Hindustan Foods is among India’s largest and most diversified organized FMCG contract manufacturers, posting 41%/51%/54% CAGR in revenue/ earnings/ gross block during FY19-FY24, while maintaining RoE in high-teens. It has a strong presence across F&B and HPC, supported by a strong balance sheet and over 30 years’ track record of consistent execution, said Systematix.

"HFL is now undergoing a transformation – it is adding marquee and mid-sized clients; high-growth segments of footwear, ice cream and beverages; and the shared-manufacturing model with these segments, indicating potentially richer margins and returns. We estimate robust 24%/28%/21% revenue/EPS/gross block CAGR over FY24-FY27E," it said with a 'buy' and target price of Rs 710.

Equirus Securities on KSB
Rating: Long | Target Price: Rs 860 | Upside Potential: 15%
KSB is a preferred choice in critical applications, having leveraged its parent’s technology to attain complete localisation in high-value segments such as nuclear, FGD, and railways. While standard pumps are its core focus area, incremental growth would be driven by high-margin engineered pumps, aftermarket, and exports, said Equirus.

"We model for a sales/Ebitda/PAT CAGR of 15%/18%/18% over CY24-CY27E with CY26E ROE/core ROIC of 19%/23% and CY25E/CY26E Pre-tax CFO/EBITDA of 90%/83%. We initiate coverage with 'long' and a June 2026 target of Rs 860 set at 40 times June 2027 EPS," it said.

Motilal Oswal Financial Services on Niva Bupa Health Insurance
Rating: Buy | Target Price: Rs 100 | Upside Potential: 20%
Motilal believes Niva has a strong position to harness the growth opportunity in the health insurance industry, backed by product innovation and customer base expansion. Investments in technology will give results in terms of operational efficiency and better profitability.

"We expect Niva to report FY25-28E GWP/PAT CAGR of 25%/32%. While the claim ratio is expected to rise with scale, operational efficiency will offset the impact, leading to a pre-1/n combined ratio of 93.4% in FY28. On IFRS basis, we expect a CAGR of 27%/34% in insurance revenue/PAT over FY25-28. We initiate coverage on the stock with a target price of Rs 100," it said.

Emkay Global Financial Services on Atul
Rating: Buy | Target Price: Rs 8,500 | Upside Potential: 35%
Atul has invested Rs 2,000 crore over FY22-24 toward capacity expansion in existing products like Liquid Epoxy Resin (50ktpa) and caustic soda (300tpd), and in the backward integration of some key products. These new capacities, along with ramp up in certain existing underutilized capacities, drive revenue potential of Rs 2,500-3,000 crore for the next 2-3 years, said Emkay.

"We expect Atul to log revenue, Ebitda and PAT CAGR of 15 per cent, 30 per cent and 37 per cent over FY24-27E, respectively. Relatively inexpensive valuation of 20 times FY27E EPS and strong earnings growth forecast make us constructive on Atul’s growth potential over the next couple of years. We initiate coverage on Atul with a 'buy' rating and target price of Rs 8,500," it said.

Kotak Institutional Equities on Dr Agarwal's Health Care
Rating: Add | Target Price: Rs 425 | Upside Potential: 7%
"Helmed by a doctor-promoter family, Dr Agarwal is the largest eye care hospital chain in India, with a 65% surgical sales mix. While the hectic pace of expansion will continue, we expect the company to be more selective in acquisitions hereon, which should drive an improvement in RoICs," said Kotak Institutional Equities.

"Further aided by continued scale-up of the recently added centers, we expect Dr Agarwal to report robust 23%/27% EBITDA/EPS CAGRs over FY2024-28E. Dr Agarwal trades at 27 times FY2027E EV/pre-Ind AS-116 EBITDA, offering a mild upside," it initiates coverage with 'add' and a fair value of Rs 425," it added.

ICICI Securities on Deepak Nitrite
Rating: Add | Target Price: Rs 2,120 | Upside Potential: 5%
While Deepak Nitrite generates strong operating cash flow, it has embarked on large capex into import substitution products – to be the crux of its sustained value creation in the medium term, said ICICI Securities, initiating coverage on Deepak Nitrite with an 'add' rating, and a target of Rs 2,120.

"Despite Deepak's large portfolio of bulk chemicals, we assign a higher multiple given its prowess in executing large projects and achieving lowest-cost manufacturing efficiency while capturing dominant market share; and ability to identify good import substitution opportunities, and cater to the swiftly growing Indian market," it said.

Equirus Securities on Jyoti CNC Automation
Rating: Add | Target Price: Rs 1,450 | Upside Potential: 30%
Jyoti CNC Automation is a leader in metal-cutting CNC (Computer Numerical Control) machines, is well-poised to benefit from multiple sectoral tailwinds – both domestically and globally. Jyoti has embarked on a large capex plan, including commensurate backward integration to capitalise on India’s expanding electronics manufacturing services (EMS) market, said Equirus.

IC Reports, Initiating coverage, Suraj Estate Developers, Hindustan Foods, Niva Bupa Health Insurance, Atul, KSB, Dr Agarwal's Health Care, Deepak Nitrite, Jyoti CNC Automation, Suraj Estate shares, Hindustan Foods shares, Niva Bupa shares, Atul shares, KSB shares, Dr Agarwal's Health shares, Deepak Nitrite shares, Jyoti CNC shares,, Anand Rathi Shares, Systematix Institutional Equities, Motilal Oswal, Emkay Global, Equirus, Kotak Institutional Equities, ICICI Securities

"It has already received two sizable orders from a marquee customer and expects even larger orders ahead. We estimate a 40%/47%/66% sales/EBITDA/PAT CAGR over FY24-FY27E with FY26E ROE at 27%. The working capital position should improve by FY25-end, meaningful FCF will happen from FY27E onwards. We initiate coverage with 'add' tag and a target price of Rs 1,450," it said.