To be fair, a few are expecting a downside but they are in the minority. Overall, the most bullish bet suggests Sensex at 72,000 and Nifty at 21,500.
But like every year, not all stocks will make money for you. Brokerages participating in the survey recommended many stocks that may help you compound wealth. We have handpicked 10 high conviction ideas, i.e., those recommended by at least two brokerage houses.
These names are: HDFC Bank, Reliance Industries, ICICI Bank, Hindalco Industries, State Bank of India, Infosys, Nippon Life AMC, Ashok Leyland, UltraTech Cement and Larsen & Toubro. As evident, most names are from the large cap space, reflecting analysts preferring the safety rather than high risks usually associated with mid and smallcap names.
Private lender ICICI Bank seems to be the crowd favourite, recommended by as many as five brokerages out of 12-odd we interviewed. Analysts are banking on its superior growth potential vis-à-vis peers.
“ICICI Bank should gain from pick up in credit growth, peaked-out NPA and credit costs, and improving return ratios. We believe sustained improvement in operating parameters will result in steady re-rating for the stock,” said Amnish Aggarwal, Head – Research, Prabhudas Lilladher.
ICICI bank’s PSU peer and the largest bank in the country, SBI, is another high conviction idea. Analysts are gearing up for a re-rating in the counter as it has been delivering estimate-beating numbers for a while now. HDFC Bank, a proven performer, also finds its place in the list from the pack.
L&T, recommended by Reliance Securities and Prabhudas Lilladher, is another name that has gained momentum. A play on increased government focus on infrastructure, it is also set to gain from superb performance of its subsidiary.
“L&T has transformed into a play on infra and technology. It is expected to be the biggest gainer from capex recovery in the economy, infra development and also strong tailwinds in IT services as it controls L&T Infotech, L&T Tech Services and Mindtree. These companies account for 40 per cent of SOTP value. We believe L&T should provide steady returns over the next 3-5 years,” said Aggarwal.
Ashok Leyland, the sole name from the auto sector to get a place in the list, is expected to gain from cyclic recovery in the commercial vehicle cycle over the coming few years, said analysts.
Ultratech Cement, a sole representative of the cement sector, is being viewed as a structural play on India’s growth. The company’s accelerated expansion plans will add to its growth in the coming years, said analysts.
