M&M, Kotak Mahindra Bank, Escorts Kubota & Jyothi Labs: 4 stock picks by SMC Global

As the benchmark indices are scaling a new record high, domestic brokerage firm SMC Global Securities has suggested four stocks- Kotak Mahindra Bank Ltd, Jyothi Labs Ltd, Escorts Kubota Ltd and Mahindra & Mahindra Ltd - to bet amid the limited opportunities to make money. The brokerage has picked the former two based on their solid fundamental parameters, while the latter two appear to be sound on the technical parameters. Here's what the brokerage has to say about these counters:

 

Kotak Mahindra Bank | Buy | Target Price: Rs 2,237 | Upside: 17%

Kotak Mahindra Bank has a network of 1,965 branches and 3,279 ATMs. It added 17 branches and reduced 12 ATMs in the quarter ended June 2024. It has maintained stable asset quality in the quarter with GNPA ratio steady at 1.39 per cent and NNPA ratio to 0.35 per cent at end June 2024. Its NIIs grew 10 per cent YoY to Rs 6,842 crore in Q1 FY25, but NIMs moderated to 5.02 per cent for Q1FY25. The bank remains focused on growing its share of unsecured retail loan books to mid-teens. Stable asset quality and growing business auger well for the banks. To help drive the future growth the bank plans to add a branch network. Thus, it is expected that the stock will see a price target of Rs 2,237 in 8 to 10 months.

 

Escorts Kubota | Buy | Target Price: Rs 4,500-4,550 | Stop Loss: Rs 3,700

Escorts Kubota marked its 52-week high of Rs 4,409.55 in month of June and since then it had been trading lower with formation of lower high pattern on daily charts. Recently the stock managed to take support around Rs 3,600 levels and bounced back once again surpassing above Rs 4,000 mark. Technically the stock has given a breakout above the Inverted Head & shoulder pattern on short term charts while on broader charts fresh Bullish momentum seen above the falling trend line of declining channel. Therefore, one can buy the stock in the range of Rs 4,000-4,080 for the upside target of Rs 4,500-4,550 levels with stop loss below Rs 3,700 levels.

 

Jyothi Labs | Buy | Target Price: Rs 613 | Upside: 14%

Jyothi Labs has a well-diversified product offering within the categories of dishwashing, fabric care, household insecticides, personal care and laundry services. The product profile comprises six power brands- Ujala, Maxo, Exo, Pril, Margo and Henko. The company has focused on strengthening its balance sheet by maintaining stable working capital with better growth visibility in the near term. It has a strong grip into its product categories and this has been possible mainly due to a distribution network. The company’s cost-saving initiatives, innovation, strong brands, an integrated distribution network and new launches will drive its volume growth on the progressing path. Thus, it is expected that the stock will see a price target of Rs 613 in 8 to 10 months.

 

Mahindra & Mahindra | Buy | Target Price: Rs 3,200-3,250 | Stop Loss: Rs 2,700

Mahindra & Mahindra has been consolidating in broader range of Rs 2,600-2,900 levels on broader charts with formation of lower high pattern. Broader trend remained intact with a bullish move as the stock can be seen holding well above its 200-day exponential moving average on daily & weekly charts. Last week a fresh breakout has been observed on charts above the key resistance level of 2900 after a phase of prolonged consolidation of nearly three months. The momentum is supported by a substantial increase in trading volume, suggesting the potential for further price gains from hereon. Therefore, one can buy the stock in the range of Rs 2,900-2,950 for the upside target of Rs 3,200-3,250 levels with stop loss below Rs 2,700 levels