Midcap stocks to watch in 2024: Deepak Nitrite, GMR Airports, Bharat Forge, Mphasis

Midcap and smallcap indices are ending year 2023 on a strong note, with the benchmark indices rising 44-46 per cent compared with a 18 per cent rise for the largecap indices. Analysts said investors need to be selective while picking midcap stocks following the sharp rally. A couple of them suggested a few midcap stocks that investors can keep an eye on in 2024. They include: 

3 stock picks by Shrikant Chouhan, Kotak Securities

Signatureglobal (India) Ltd
Signatureglobal is an NCR-based real estate company, grown rapidly to become one of the largest affordable and mid-income housing-focused players in the region. Its pre-sales have grown 8 times between FY20 and FY23 to Rs 3,400 crore. Signature has an enviable track record of quick turnaround (acquisition to delivery), Chouhan said. Strong cash generation has enabled the company to continue to invest for future growth. Chouhan expects the company to deliver a 26 per cent CAGR over FY23-26E, with improvement in margins to 20 per cent. "Revenue recognition and margin should follow strong pre-sales. Indian real estate—in the midst of a multi-year upcycle," he suggested 'ADD' rating and with a Fair Value of Rs 910 on the stock.

360 One Wam Ltd 
360 One Wam Ltd (erstwhile  IIFL Wealth Management Ltd): Net effect of recent flows has caused yield pressure on P&L. Recurring revenue growth in the next 1-2 years is likely to improve through flow momentum, new fund launches, institutional mandates and improved monetisation of advisory clients. The impact of new verticals (HNI/offshore) will show up in FY26. We expect core yields on recurring business to remain flat over the medium term, Chouhan said He also expects core yields on recurring business to remain flat over the medium term. Chouhan suggested a 'Buy' on the stock with a fair value of Rs 750 against Rs 600 earlier.

Mrs Bectors Food Specialities Ltd

Improving share in biscuits, increased premiumisation, strong pricing power, improving direct distribution network, and the management bandwidth would drive growth for Mrs Bectors Food Specialities going forward. Chouhan suggested 'ADD' on the stock with a target of Rs 1,330.

2 picks by Sunil Nyati, Swastika Investmart 

Deepak Nitrite Ltd
In the underperforming chemical sector, which is exhibiting signs of a potential turnaround, Nyati sees Deepak Nitrite as a preferred investment. "Leveraging its strong track record, Deepak Nitrite stands out as a promising choice, especially with expectations of a financial upswing starting from Q2F25. The company's historical performance instills confidence in its resilience and potential for future growth within the evolving chemical landscape," he said.

GMR Airports Infrastructure Ltd
Turning to the infrastructure theme, which is poised for a favorable trajectory in 2024, Gmr Airports Infrastructure  emerges as a likely outperformer, Nyati said. Anticipating improvements in both the order book and financials, GMR Airports appears well-positioned for positive momentum, he added.  

"The added endorsement of marquee investors further underscores the stock's potential, signaling confidence in its prospects," he said.

2 stock picks by Rupak De, senior technical analyst at LKP Securities

Mphasis Ltd 
The Mphasis stock has broken out of consolidation on the monthly chart. Additionally, the stock received support from the critical moving average before the recent rally. De suggested a buy range of Rs 2,700-2,730 for a target of Rs 3,500 and a stop loss of Rs 2,500. 

Bharat Forge Ltd 

Bharat Forge has been trading continuously above the rising moving average. Besides, the stock is currently maintaining a strong uptrend, marked by higher highs and higher lows on the weekly chart. De suggested a buy range of Rs 1220-1240  for a target of Rs 1,500 and a stop loss of Rs 1,050.