8 Nifty50 stocks including HDFC twins, Dr Reddy’s, UltraTech, HUL hit 52-week lows; here is what brokerage opines

At least eight stocks in the Nifty50 index touched their respective 52-week lows on the NSE and BSE on Friday on the back of massive selling pressure. The ongoing Russia-Ukraine geopolitical situation is termed to be denting the investors sentiments, most of the experts believe. 

Mortgage lender Housing Development Finance Corporation (HDFC), HDFC Bank, Hindustan Unilever (HUL), Britannia Industries, UltraTech Cement, Shree Cement, Dr Reddy’s Laboratories and Hero MotoCorp have hit their respective 52-week lows today. 

See Zee Business Live TV Streaming Below:

The benchmark indices – Sensex and Nifty50 – on the last day of the week opened negative, down almost 1 per cent. The sell-off in the market continues for the third straight session today. Both frontline indices were down 3 per cent in the last one week and 8 per cent down in one month. 

Similarly, total 26 stocks from the Nifty500 index such as Ashok Leyland, Apollo Tyres, Ramco Cement, Dalmia Bharat, JK Cements, Kansai Nerolac and SBI Cards and Payment Services among others hit their respective 52-week lows, besides the eight Nifty50 scrips.  

According to domestic brokerage firm Motilal Oswal, “External risks continue to rise in the calendar year 2022, with geopolitical events adding to the milieu. The Russia-Ukraine crisis has further raised market volatility, hastened the risk-off sentiment, and drove the correction in equity markets.” 

The brokerage highlights the correction in global and domestic markets, the relative price damage in different sectors, and the impact on valuations of Nifty companies. Also, close to half of the Nifty constituents are now trading at a discount to their respective 10-year average valuation metrics. 

After the recent correction, the Nifty is now trading at 19x/16.5x FY23E/FY24E earnings, Motilal Oswal estimates, adding further that our portfolio construction is premised on stocks where the earnings visibility remains solid, pricing power is healthy, and the recent correction has led to moderation in valuations and continue to remain biased towards large caps.