.png)
Despite significant challenges, including persistent inflation, heightened interest rates, and geopolitical tensions, the Nifty 50 index successfully wrapped up Samvat 2079 with robust gains, underscoring the market's resilience. Impressively, the Nifty 50 has surged nearly 10 percent since Diwali 2022, and experts foresee a positive outlook from Diwali 2023 to Diwali 2024. However, the market has risks, with geopolitical uncertainties and fluctuating crude oil prices posing potential threats. On the domestic front, factors like General Elections, inflation, and the trajectory of interest rates loom as major headwinds, adding an element of caution to the otherwise optimistic forecast.
Industry experts are placing their bets on the promising growth trajectory of the Indian economy. In addition to this optimistic outlook, significant central banks such as the US Federal Reserve and the Reserve Bank of India (RBI) are anticipated to initiate interest rate cuts starting in May or June of the upcoming year. This potential move is poised to inject a positive boost into global market sentiment, making it an exciting time for investors and enthusiasts alike.
However, stock selection will remain the key to earning good profit, say experts. Even during a broad-based market rally, investors should be prudent in their stock selection and bet on only quality stocks with healthy fundamentals.
Suggesting the following 10 stocks from the large, mid, and small-cap sectors. these stocks have strong upside potential. Take a look:
Large-cap picks
ICICI Bank | Current market price: ₹938.35 | Target price: ₹1,298 | Upside potential: 38%
The share of retail advances stands higher at 54.3% and the share of low-cost CASA is also at a healthy level of 40.8%. Of the total retail portfolio, nearly half is towards housing loans, which are secured in nature. The bank’s Q2FY24 credit growth stood at 18.3% YoY driven by healthy double-digit growth across all domestic loan segments.
While its NIM (net interest margin) moderated as expected to 4.53% and some margin compression is expected to continue in the near term, maintained 4.5% NIM in FY24, which will be higher than most private sector peers.
The brokerage firm expects the bank’s RoA (return on assets) to remain in the top quartile at 2.4% over FY23-FY25E, driven by 17.1% loan CAGR, stable margins, and lower credit costs.
SBI Life Insurance Company | Current market price: ₹1,355.85 | Target price: ₹1,600 | Upside potential: 18%
SBI Life has demonstrated a robust APE CAGR of 15% over FY18-FY23. The strong growth trajectory is to continue, aided by a stable product mix, a higher ULIP share driving volume, and a growing Protection franchise.
Cost leadership (total cost ratio of 9.4% versus 16-21% for peers) provides a competitive edge; expect the margin to sustain between nearly 28-30%.
Britannia Industries | Current market price: ₹4,684.60 | Target price: ₹5,515 | Upside potential: 18%
The stock is trading at 43 times and 37 times FY24E and FY25E EPS, respectively, and we value the company at nearly 50 times Sept’2025E EPS (3-year and 5-year average at 48 times and 47 times respectively) due to the structural opportunity in the packaged foods space, more than 50% RoE (return on equity), healthy dividend payout and the potential addition of new categories going ahead.
Cipla | Current market price: ₹1,240 | Target price: ₹1,400 | Upside potential: 13%
The brokerage firm is positive about the stock because of its robust product pipeline which is expected to provide strong visibility in the US market. Nearly 28% of revenues come from low low-competition respiratory segment.
We are positive about the company mainly due to its strong India franchise, robust US pipeline, healthy margins, and improving return ratios.
Nirmal Bang expects 12.5%, 18%, and 28.2% revenue, EBITDA, and PAT CAGR over FY23-25E, respectively, with 221 bps improvement in margins.
Ambuja Cement | Current market price: ₹417.95 | Target price: ₹602 | Upside potential: 44%
Ambuja can set industry standards by striking a balance between capacity build-up and cost management by capitalizing on the ongoing strong demand potential, premium product portfolio, operational excellence, supply chain management, and sales and marketing expertise via the parent company.
Capex initiatives reflect the company's commitment to growth, technological advancement, and market positioning, with a focus on improving operational efficiency, seizing opportunities in the cement industry, and achieving its target cement capacity of 140MTPA by FY28.
Midcap and smallcap picks
Mold-Tek Packaging | Current market price: ₹882.65 | Target price: ₹1,200 | Upside potential: 36%
Mold-Tek Packaging has demonstrated its strength by consistently improving EBITDA/kg through innovation and expansion of the product basket and backward integration.
While the existing segments like Paints and F&F are expected to continue their strong growth trajectory on the back of capacity additions and order visibility from clients, we see multiple growth levers like the IBM projects and the Pharma Packaging business for the company from a medium-term perspective. All future projects are margin and return ratio accretive, with the possibility of improvement in the working capital cycle over the medium to long term.
PNC Infratech | Current market price: ₹316.15 | Target price: ₹469 | Upside potential: 48%
From FY22-FY26, Nirmal Bang expects the company to generate OCF (operating cash flow) at a CAGR of 37%.
While the industry is facing problems of financial closure and fundraising, PNC Infratech’s strong balance sheet position, robust credit profile, and brand image have helped it stay ahead of the curve and overcome these challenges.
Triveni Turbine | Current market price: ₹403.25 | Target price: ₹530 | Upside potential: 31%
Triveni Turbine is a key beneficiary of the ongoing decarbonization capex and energy diversification theme. The brokerage firm expects Triveni Turbine to register 30% and 34% revenue and earnings CAGR, respectively, over FY23-FY26E.
Triveni Turbine’s strong margins, lean working capital, healthy cash flows, and balance sheet, and long-term growth prospects (diversification in new types of turbines) will support the valuation.
Apar Industries | Current market price: ₹5,106.30 | Target price: ₹6,075 | Upside potential: 19%
Apar Industries' revenues are to grow by 25% - 30% CAGR to new few years with EBITDA margins expected to remain in double digits.
Outlook over the medium term remains strong due to healthy demand amid aggressive capex plans being executed globally for RE capacity addition, transmission expansion, infrastructure development, public transportation, and telecom push coupled with benefits of ‘China+1’. We expect revenue/EBITDA/PAT to grow by 18% /19% /20% CAGR over FY23-FY26E.
United Breweries | Current market price: ₹1,576.20 | Target price: ₹1,930 | Upside potential: 22%
The stock has been an underperformer due to the impact of Covid in key summer seasons in FY21 and FY22 (and partly in FY20 as well) and the subsequent sharp spike in barley costs meant that EBITDA is likely to decline by about 4% CAGR in FY24 versus FY19 levels, after growing by mid-teens CAGR in the preceding five years.
.png)
