Short-term investment ideas: Vikas Sethi recommends buying these 4 stocks; here's why

Short-term investment ideas: With the benchmark Nifty50 and Sensex scaling record closing highs, many investors are scouting for investment ideas to participate in the rally. Vikas Sethi of Sethi Finmart has shared four midcap and smallcap stock picks from a short-term perspective.

Sethi is bullish on Jammu & Kashmir Bank Ltd (J&KBANK), Man Infraconstruction Ltd (MANINFRA), Ask Automotive Ltd (ASKAUTOLTD), and Cheviot Company Ltd (CHEVIOT), with targets of Rs 142, Rs 215, Rs 320, and Rs 1,600, respectively.

Here are the details of his four recommendations:

Vikas Sethi Stock Pick | Buy Cheviot Company Ltd shares

Recommendation: Buy
Target Price: Rs 1,600
Stop Loss: Rs 1,490

Rationale:

• The company generates 42 per cent of its revenue from exports, underscoring its strong global presence
• With increasing demand for sustainable products, companies's eco-friendly jute offerings are becoming more popular, especially as alternatives to plastic
• The company has a good financial structure with zero debt
• Cheviot is known for its strong profit margins, making it an attractive investment

Vikas Sethi Stock Pick | Buy Ask Automotive Ltd shares

Recommendation: Buy
Target Price: Rs 320
Stop Loss: Rs 290

Rationale:

• The company operates 16 plants across five states in India and is set to open a new plant in Karauli, Rajasthan, this quarter
• Additionally, plans are underway for another plant in Bengaluru, which will become its 18th facility
• ASK Auto's client list includes major names like TVS, Hero MotoCorp, Honda, Suzuki, and Royal Enfield, along with several international companies
• Recently, the company entered into an agreement with a Taiwanese company to produce alloy wheels using a new technology, giving it a first-mover advantage
• The company’s Q4 results were impressive, with a profit after tax (PAT) of Rs 45 crore, up from Rs 25 crore the previous year
• The RoE stands at 20 per cent, and the RoCE is around 25 per cent
• Institutional investors include Goldman Sachs Funds, Tata Mutual Fund, and SBI Life

Vikas Sethi Stock Pick | Buy Man Infraconstruction Ltd shares

Recommendation: Buy
Target Price: Rs 215
Stop Loss: Rs 192

Rationale:

• The company is involved in significant projects, including the Aradhya project in Ghatkopar and Tardeo, with a potential revenue of Rs 3,000 crore
• The company has a strong sales record and numerous new projects in the pipeline
• It undertakes EPC projects, mainly focusing on port infrastructure
• The company has worked on the JNPT port, with an order book of around Rs 1,000 crore
• The fundamentals are strong, with an ROE of 23-24 per cent and a ROCE of 38 per cent
• The debt-to-equity ratio has been reduced from 0.65 to 0.19, making the stock attractive at a valuation multiple of 23-24
• Institutional investors hold 5.75 per cent of the stock, with Quant Mutual Fund holding 1.62 per cent

Vikas Sethi Stock Pick | Buy Jammu and Kashmir Bank Ltd shares

Recommendation: Buy
Target Price: Rs 142
Stop Loss: Rs 127

Rationale:

• The bank operates mainly in Jammu and Kashmir but has expanded to 18 states and four union territories with nearly 990 branches
• The bank boasts a capital adequacy ratio of around 15 per cent and a net interest margin close to 4 per cent
• The bank has seen a significant reduction in non-performing assets (NPAs), indicating improved asset quality
• In the March quarter of this year, the bank reported a net profit of Rs 649 crore, a substantial increase from Rs 476 crore in the same quarter the previous year
• With normalcy returning to Jammu and Kashmir and an uptick in tourism due to the region's appeal as a hill station, the bank stands to benefit. Additionally, government economic incentives in the region are expected to drive credit uptake