DOMS, Fedfina, Hindalco among 8 stocks that saw brokerage initiations with up to 60% upside target

Select stocks including Doms Industries, Indo Count Industries, Fedbank Financial Services, Gulf Oil Lubricants, Hindalco Industries, Juniper Hotels and Happy Forgings have seen fresh interest from the various brokerage firms, who have recently initiated their coverage on these companies.

The host of brokerages including IIFL Securities, Share India Securities, Equirus Securities, ICICI Securities, Systematix Institutional Equities, Elara Capital and Motilal Oswal Finance Services have launched their maiden reports on these stocks. Majority of these stocks have 'buy' ratings on them with an upside potential of up to 60 per cent. Here's why these analysts are positive on them:

Systematix Institutional Equities on Hindalco Industries
Rating: Buy | Target Price: Rs 693 | Upside: 30%
Hindalco Industries is an integrated producer of aluminium and copper, and operates through four businesses. Its US-based wholly-owned subsidiary, Novelis is the largest manufacturer of aluminium flat-rolled products (FRP) globally. It is calculatedly steering towards a green future to reduce carbon footprint by 30 per cent by FY26, said Systematix Institutional Equities.

"Backward integration, raw material security, and technologically-advanced manufacturing facilities render Hindalco as one of the lowest-cost aluminium producers globally. Hindalco is focused on deleveraging its balance sheet as also meeting its future growth plans, through robust operational performance and cash flow generation," it said with a 'buy' call and target price of Rs 693.

Elara Capital on Juniper Hotels
Rating: Buy | Target Price: Rs 545 | Upside: 21%
Juniper Hotels, jointly promoted by the Saraf Group and Hyatt Hotels Corporation, and backed by its niche positioning in the luxury hotel development segment is the largest owner of Hyatt-affiliated hotels in India. It is also the only hotel company in India to have a strategic equity investment by Hyatt. Juniper is indeed exquisitely placed in terms of lineage, said Elara Capital.

"Juniper, being a Hyatt affiliate company, is expected to trade at a premium to peers. With several organic and inorganic growth opportunities and strong promoter pedigree, we expect topline, Ebitra and PAT CAGRs of 17 per cent, 20 per cent and 33 per cent through FY24E-27E, respectively. Initiate with 'buy' for FY26E target price of Rs 545 based on 22 times FY26E EV/Ebitda," it added.

IIFL Securities on Doms Industries
Rating: Buy | Target Price: Rs 1,875 | Upside: 32%
Doms is the fastest growing Stationery and Arts Materials brand in India and is also the second largest player in India’s Branded
's stationery and art products market, with a market share of 12 per cent. Superior product quality, world-class manufacturing facilities, a strong brand recall and synergistic partnership with FILA has ensured robust top-line performance, said IIFL Securities.

"Scale-up of adjacencies (pens, sketch-pens, back-to-school categories and more) and steady growth in existing core categories will drive sales and EPS CAGR of 25-28 per cent, respectively over FY24-26. We initiate our coverage with a 'buy' rating and target price of Rs 1,875," it added, suggesting an upside of 32 per cent from its previous close.

ICICI Securities on Gulf Oil Lubricants
Rating: Buy | Target Price: Rs 1,250 | Upside: 21
We initiate coverage on Gulf Oil Lubricants with a 'buy' rating and a target price of Rs 1,250. Gulf Oil is the second largest private player in the petroleum lubricant space, with an estimated 7-8 per cent market share in its focus segments of automotive and industrial lubricants, as per the company. It has progressively been cornering market share over the last three years,

With aggressive branding and distribution rollout, diversification initiatives into battery and EV fluids and chargers, Gulf oil earnings momentum should remain industry leading over FY24-27E. We factor in 11.4% EPS CAGR over FY24-27E and value it using an average of PER, EV/EBITDA and PEG, it said citing downtick in demand, execution delays and competitive pressures as key risks.

Kotak Institutional Equities on Utkarsh Small Finance Bank
Rating: Buy | Fair Value: Rs 60 | Upside: 30%
Utkarsh Small Finance Bank (SFB) is well-positioned to deliver a healthy loan book CAGR of 28 per cent over FY2024-27E, driven by a large growth opportunity, stable senior leadership, improving liability franchise and an improved asset quality environment, said Kotak Institutional Equities.

"We expect the bank to deliver RoE of 17-19 per cent, led by a highly profitable microbanking business. We find current valuations to be reasonable and initiate coverage with a BUY rating and RGM-based Fair Value of Rs 65," it added.

Motilal Oswal Finance Services on Happy Forgings
Rating: Buy | Target Price: Rs 1,125 | Upside: 22%
Happy Forgings (HFL) is a Ludhiana-based company specializing in diversified forging and machining services. With over four decades of industry experience, it manufactures and delivers top-quality, intricate components. The company is well established within the industries and customer segments it serves, including heavy commercial vehicles, farm equipment, off-highway vehicles and industrials, said Motilal Oswal.

"HFL is well poised to grow in the coming years, led by expansion through increased capacities, product diversification, client acquisition, and emerging opportunities in industrials and exports. We expect 21 per cent, 25 per cent and 30 per cent CAGR over FY24E-26E in standalone revenues, Ebitda and PAT, respectively" it said, initiating coverage with a 'buy' rating and a target of Rs 1,125.

Equirus Securities on Fedbank Financial Services
Rating: Long | Target Price: Rs 160 | Upside: 30%
Fedbank Financial (Fedfina) was incepted to originate loans for Federal Bank. It transformed into a retail lending platform in 2018, post onboarding of the new management and investment by True North. It is a retail focused NBFC and targets the MSME sector. Its secured book constitutes 85 per cent of its portfolio, said Equirus Securities, with a 'long' rating and target price of Rs 160.

"During FY18-9MFY24, Fedfina clocked an impressive 42 per cent AUM CAGR to Rs 10,710 crore. Gold, mortgage and business loans formed 31.8 per cent, 51.1 per cent, and 15.5 per cent of AUM as of 9MFY24, respectively. We believe a bank backing offers a sharp competitive edge. With a diversified/secured asset portfolio, it is well placed to benefit from MSME credit tailwinds," it said.

Share India Securities on Indo Count Industries
Rating: Buy | Target Price: Rs 500 | Upside: 60%
Indo Count Industries is the world’s largest manufacturer and exporter of bed sheets. The Company is increasing its focus on the $11 billion addressable market of high margin value added products. A confluence of industry tailwinds along with strong structural levers makes it a formidable bet in the textile space, said Share India in its IC report.

"We believe the company is on path to emerge from a cyclical textile player to a de-risked stable player resulting in re-rating of P/E multiple. We estimate PAT to grow at a CAGR of 31 per cent over FY23-FY26. On assigning a P/E multiple of 16 times on its FY26 EPS, we arrive at a target price of Rs 500," it said.

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