Global View: HDFC Bank, Sun Pharma and L&T could give 28-40% return; here’s why

The Indian markets could consolidate on Monday tracking muted global cues but there will be a stock-specific action in which global brokerages tweaked their rating or specific reports.

The texture of the market is bullish but due to an overstretched rally, the market could consolidate between 18,050 and 18,375.

“For the bulls, 18375-18400 would be the immediate hurdle and above the same, the same breakout formation will continue up to 18500. On the flip side, 18150 would be the sacrosanct support level to watch out for,” Amol Athawale, Deputy Vice President - Technical Research, Kotak Securities Ltd, said.

“If the index succeeds to close below the same, the Nifty could retest 18050-18000 levels. The Bank Nifty has completed one leg of correction and took support near the 9 days SMA,” he said.

The structure suggests 38,000 and 37,500 would act as strong support zones. Above the same, the uptrend momentum will continue till 39,000-39,300.

We have collated a list of recommendations from various global brokerage firms according to a Zee Business TV report:

HDFC Bank: Buy| Target Rs 2,160

Jefferies maintained a buy rating on HDFC Bank post-December quarter results but raised the target to Rs 2,160 from Rs 2,070 that translates into an upside of nearly 40 per cent from Rs 1,545 recorded on 14th January.

The revenue momentum is steadily building up and is on track for a comeback. The net interest income (NII) growth is likely to improve to 16-17% over H1FY23

However, the global investment bank was a tad disappointed with weak fees but was positively surprised by better asset quality/lower credit cost.

The management guided for reversion to normalised levels in a few quarters. It sees an 18% CAGR in profit over FY21-24.

Also Read: Buy, Sell or Hold: What should investors do with Trident, Deepak Fertilisers and Infosys?​

Sun Pharma: Buy| Target Rs 1,100

CLSA maintained its buy rating on Sun Pharma with a target of Rs 1,100 that translates into an upside of 28 per cent from Rs 860 recorded on 14 January.

Sun Pharma is our top pick in the pharma sector and is part of the CLSA India focus list. The global investment bank expects specialty ramp-up to continue and turn profitable in 2022.
 
The US FDA re-inspection of the Halol plant and its timely resolution, along with progress on the specialty R&D pipeline, are other catalysts to watch for.

Specialty business turnaround should be the main lever of 2.8ppt margin expansion to 28.1% over FY21-24CL and drive 16% earnings CAGR. Sun deserves to trade at premium PE valuations to other Indian peers, said the note.

L&T: Buy| Target Rs 2,845

Jefferies maintained a buy rating on L&T with a target price of Rs 2,845 that translates into an upside of 39 per cent from Rs 2,045 recorded on 14th January.

The global investment bank believes the order flow trajectory should move to 15% CAGR in FY21-24E, compared to 10% in the past 10 years.
 
Railways, including metro projects, power T&D linked to renewable energy generation, roads, PLI and data centres should all contribute to higher growth ahead.

(Disclaimer: The views/suggestions/advices expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)