Hindware, Artemis, GRSE, ACIL, Carysil, Laurus Labs among 9 stocks that saw brokerage initiations

Stocks such as Hindware Home Innovation, Artemis Medicare Service, CSB Bank, Garden Reach Shipbuilders & Engineers, Carysil, Archean Chemical Industries, Laurus Labs, Poly Medicure and KEC International have seen fresh interest from the various domestic brokerage firms, who have recently initiated their coverage with an upside potential up to 91%.

The host of brokerages, including HDFC Securities, Nuvama Institutional Equities, Ventura Securities, Systematix Institutional Equities, Keynote Capitals Research, Monarch Networth Capital and JM Financial have launched their maiden records recently. Here's why these brokerages are positive on the stocks:

Nuvama Institutional Equities on Hindware Home Innovation
Rating: Hold | Target Price: 546 | Upside: 53%
Hindware Home Innovation has advanced significantly from being a manufacturer of just one product to holding market leadership in sanitaryware and being a significant player in faucet ware. It holds a 23 per cent and 6 per cent market share in organized sanitaryware and faucet ware, respectively, Nuvama said with a buy rating and target price of Rs 546.

Given its strong positioning in bathware, increasing presence in pipes and fittings and consumer appliances coupled with a comprehensive product portfolio, strong brand recall, and a wide and expanding distribution reach, we are optimistic about its medium to long-term growth prospects. It can continue to deliver strong overall growth with a constant focus on product innovation, it said.

HDFC Securities on CSB Bank
Rating: Hold | Target Price: 295 | Upside: 16%
The Bank reported healthy growth numbers in the provisional release for FY23. Deposits grew 21.4 per cent for the year out of which CASA deposits grew 16.1 per cent. Gross advances rose 30.3 per cent YoY out of which advances against gold and gold jewellery rose 47.7 per cent YoY. Non-gold loans have started to grow well, said HDFC Securities.

"The bank has a strong provision coverage ratio of 91.9 per cent. The asset quality of the bank has improved significantly over the last one year and the trend of strong recoveries and upgrades is expected to continue. We believe that investors can buy CSB Bank for the base case fair value of Rs 270 and for the bull case fair value of Rs 295," it added.

Ventura Securities on KEC International
Rating: Buy | Target Price: 699 | Upside: 50%
KEC International has diversified into newer areas of growth, such as railways, civil, oil & gas pipelines, and solar, where the profitability is higher and net working capital (NWC) requirements are lower. Subsequently, the order book concentration of the power T&D business has dropped from a staggering 45 per cent in FY22, said Ventura Securities.

"The diversification worked well in the favor of KEC and its order book and revenue grew at a CAGR of 13.9 per cent and 13.2 per cent, respectively, during the turbulent period of FY19-22, while the NWC to sales ratio reduced to a paltry 1 per cent in FY23, down from a towering 26 per cent in FY15.  We initiate coverage on KEC with a target price of Rs 699," it said.

Keynote Capitals Research on Laurus Labs
Rating: Hold | Target Price: 396 | Upside: 30%
Laurus diversified its operations by entering into formulations and contract development and manufacturing organization (CDMO) services to become an integrated pharmaceutical company. Currently, the company’s business operations are diversified into Generics API, Formulations, CDMO Services, and Biotechnology, said Keynote's maiden report.

It markets products in over 60 countries, with exports contributing 72 per cent of the revenue. Its ARV segment faced pricing pressure during 9M FY23, impacting the overall margins due to high product concentration. Laurus is gearing up its capacity expansion in non-ARV and CDMO segments, which will help to reduce product concentration risk and tap patent expiry opportunities, it said with a buy rating and target price of Rs 396.

Monarch Networth Capital on Carysil
Rating: Buy | Target Price: 780 | Upside: 30%
"We initiate coverage on Carysil with a target price of Rs 780. Carysil, growing at a CAGR of 20 per cent, is the only Asian and among the four global manufacturers of quartz sinks using Schock technology. We estimate the company has a market share of more than 20 per cent globally," said Monarch Networth Capital in its initiating coverage report.

Its vast global presence will be further fortified by the company’s widened product portfolio through the addition of adjacent categories such as steel sinks, kitchen appliances, countertops, and bathroom fittings. The company is one the few suppliers to leading home retail and big brands such as Kraus and Karren, Grohe and recently agreed with Ikea, it said.

Systematix Institutional Equities on Poly Medicure
Rating: Hold | Target Price: 990 | Upside: 6%
"We initiate coverage on Poly Medicure with a 'Hold' rating and target price of Rs 990, based on 33x FY25E EPS. PLM is a leader in disposable medical devices and is gradually transforming its portfolio to build a presence in categories that have high entry barriers and large growth potential," said Systematix Institutional Equities in its initiating coverage report.

It estimates a strong growth in its sales, EBITDA and net earnings, respectively, over FY22–25E, underpinned by its entry into the dialysis segment, ramp up in the US market, and volume growth in base portfolio via higher market share and market expansion. We are optimistic on the company’s ability to maintain its growth trend but there is limited upside, it said.

JM Financial on Archean Chemical Industries
Rating: Buy | Target Price: 785 | Upside: 27%
Archean (ACIL) was the largest exporter of bromine and industrial salt by volume in India in FY21, and it is amongst the lowest-cost producers of both bromine and industrial salt globally. The company is currently in the process of expanding its bromine capacity to 42,500MT. It is also spending over INR 2.5bn on a bromine derivatives plant, said JM Financial.

"On account of fixed pricing contracts, ACIL offers a high degree of earnings certainty. Moreover, the competitive threat to ACIL is limited due to its cost leadership and long-term customer relationships. We initiate coverage on ACIL with a 'Buy' and a March 2024 target price of Rs 785 per share," it said.

HDFC Securities on Garden Reach Shipbuilders & Engineers
Rating: Buy | Target Price: 540 | Upside: 17%
GRSE has the ability to sustain the overall performance at the present level in a competitive environment, while maintaining leadership in warship building and retaining its largely debt-free status with comfortable liquidity. Growth momentum is expected to continue in the coming quarters, said HDFC Securities while initiating coverage on the stock.

"The company is currently working on seven projects, comprising 15 ships for the Navy, Coast Guard, and others. While the company can pass through the higher cost, a sudden spike in prices of raw materials, like steel and energy, can impact profitability. Investors could buy and the bull case fair value of the stock is Rs 540," it said.

Ventura Securities on Artemis Medicare Service
Rating: Buy | Target Price: 134 | Upside: 91%
Artemis Medicare Services was established in 2007 as a subsidiary of Apollo Tyres. It was demerged and listed separately in January 2020 as a standalone entity. Artemis currently operates a 541 bedded multi-specialty, tertiary and quaternary care facility along with 3 'Daffodils' - mother & child care facilities and one asset light multi-therapy center, said Ventura.

In addition, it has set up 9 Artemis Cardiac Centers (ACC) in 65:35 JV with Philips Medical Systems Netherlands BV, across various cities to provide affordable cardiac therapy services. We initiate with a 'Buy' coverage on Artemis with a price target with a price target of 134," its IC report added.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Business Today)

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