Midcaps that rallied upto 455% since last Diwali The Indian markets have been centre of attraction for foreign institutional investors for the past one year. The change in government at the centre, improvement in macros and hopes of pick-up in domestic economy fueled the phenomenal rally in not only largecaps but also the midcaps. The midcaps, which remained laggards for the past couple of years, saw phenomenal rise in stock prices of stocks from cyclical sectors. The BSE Midcap Index gained 52 per cent in since Samvat 2070 but individual stocks have rallied over 450 per cent in the same period. Following are the stocks from midcaps space which have given stellar returns in the past one year: NBCC Returns 455% NBCC presents a strong growth story on the back of its niche presence in government housing colony re-development as well as strong presence in the project management contract business for Central and State Government bodies, ministries and organizations, says Nomura report. The brokerage sees multiple triggers for the company over the next 6-12 months that could escalate the growth profile of the company manifold for several years. NBCC still seems inexpensive at ~12.6x FY16F EV/EBITDA, given its strong order backlog and new order pipeline visibility leading to EPS CAGR of ~38% over FY14-17F, FY16-17F ROE of 30-35 per cent and net cash balance sheet, Nomura said in its September report. The brokerage has a price target of Rs 1,049 on the stock. TVS Motor Company Returns 411% Analysts at Reliance Securities are of the view that the company would continue to gain market share in a sustained manner. Launch of Scooty Zest and new Star City+ in the Southern markets, new launches in a staggered manner, push for moped in Northern markets, expansion of touch points by 10 per cent every year and launch of two premium bikes along with BMW by 4QFY16 are seen as the driving factors for the company. We expect the company to post strong margins expansion aided by operating leverage and low cost sourcing and marketing; however, we do note that this expansion could be backended as the near-term aim for the company is to gain market share, the report said. The brokerage has maintained its estimates and reiterated BUY with a target price of Rs 279 on the stock. JK Lakshmi Cement Returns 388.10% JK Lakshmi cement is the 5th largest cement producer in North India with a ~7 per cent market share in the region with a capacity of 6.6mtpa. This is backed by 1) one of the most efficient operations, 2) entry into the most profitable eastern region with a capacity of 2.7mtpa, scheduled to get commissioned by Dec-14, and 3) increasing consolidation in Gujarat (~40% of its total volumes) ranks JKLC as one of our top pick in the sector, said Prabhudas Lilladher report. The brokerage has Buy rating on the stock with price target of Rs 375 at EV/T of US$90 FY16E capacity of 11m tonnes. Symphony Returns 336.53% Symphony recorded another stellar performance in July-September quarter. Net profit increased 51 per cent to Rs 22 crore led by a higher EBITDA margin and sharp growth in other income. Standalone revenue increased by 42.5 per cent to Rs 102.7 crore (YoY) led by strong volume growth of 38 per cent YoY. Standalone revenue increased by 42.5 per cent to Rs 102.7 crore (YoY) led by strong volume growth of 38 per cent YoY. EBITDA margins increased 391 bps YoY supported by a sharp decline in selling & distribution expenses by 340 bps YoY. At the CMP, the stock is trading at its all-time high P/E of 41x FY15E, 32x FY16E and 25x FY17E respectively. We roll over our valuation on FY17E considering the revival in the Indian economy. We value the stock at 30x FY17E earnings, said ICICI Securities report. The brokerage has upgraded the stock to BUY rating and revised target price to Rs 1850 per share. Monsanto Returns 309% Monsantos main focus is to improve the age profile of its corn portfolio from eight years to five, going forward. The management told Motilal Oswal that it plans to aggressively launch newer hybrids over the next two years and phase out older ones. Also, most of the new hybrids will be single cross, which should drive margin expansion. We expect revenue to post 18 per cent CAGR and PAT 25 per cent CAGR over FY14-17E. We believe Monsantos market share journey has just begun driven by 9x growth in hybrids launched in the last two years, and is a testimony of farmers acceptance of Dekalb brand, the Motilal Oswal report said. We remain optimistic on the huge potential in genetically modified (GM) foods and RR Flex, which should drive long term growth, the report added. The brokerage has maintained a Buy, with a target price of Rs 3,500 on the stock. Source: The Economic Times
Posted on: Wed, 22 Oct 2014 10:58:24 +0000