2 Reputed Stock Recommendations From Geojit: 1 Buy, 1 Hold

A leading securities firm, Geojit has recommended investors to buy shares of a life insurance firm and hold shares of a Navratna, public sector defence electronics company. The companies are ICICI Prudential Life Insurance Co. Ltd and Bharat Electronics Ltd. The securities firm believes that both price of stock of both the companies will probably grow further upward. Check the details below.

Hold shares of Bharat Electronics Ltd, with a price target of Rs 107 per share
Geojit sees potential return of upto 10% from the stock price of Bharat Electronics Ltd, having a Navratna status. It's has a 37% market share in Indian defence electronics. The company's core capabilities are in radar & weapons systems, defence communication, & electronic warfare. Its current market capitalisation is Rs 70,510.13 crore.

Q3FY23 revenue grew by 12%, but profit after tax was flat on a YoY basis. EBITDA margin declined by 160 bps YoY to 20.7%, on account of higher other expenses. Order inflow for 9MFY23 was down by 70% YoY due to delays. But given a healthy order pipeline and the increasing modernization drive in defence, order booking should pick-up going ahead. While, the order back log is at Rs.50,116 cr (3.3x FY22 sales), providing strong earning visibility for the next 3 years. We maintain our positive view in the long term, considering strong order book visibility, execution prowess and a stable margin profile ~22%. While PAT continues to grow at a 16% CAGR over FY23E-25E. We value Bharat Electronics Limited at a P/E of 20x on FY25E, and maintain Hold rating with a target price of Rs 107 per share."

The last trading price of stock of Bharat Electronics Ltd is Rs 96.46 Rs per share, it is up by 0.62% on intraday basis. Its 52-week high is at Rs 115 per share and 52-week low is at Rs 67.7 per share and in one year the stock price rallied by 36.09%.

Buy shares of ICICI Prudential Life Insurance Co. Ltd, with a price target of Rs 480 per share.
As per Geojit, the stock price of ICICI Prudential Life Insurance Co. Ltd would potentially grow significantly by upto 17%. Its current market price ended at Rs 405.35 per share, was up 0.04% over previous day, but in one year the stock price fell by 9.35%.

ICICI Prudential Life Insurance Co. Ltd. is a joint venture between ICICI Bank and Prudential Corp. Holdings, offering life, health and pension products. It is one of the leading players in life insurance space and has a market capitalisation of Rs 58,312.20 crore.

According to Geojit, "ICICI Prudential Life Insurance Co Ltd's share of business of non-unit linked policies with an annual premium of over Rs 5 lakh was only 6% of the total annualised premium equivalent (APE) in 9MFY23. Higher assets under management (AUM), a healthy solvency ratio, increased investments in technology, and strong VNB growth auger well for the company's future performance. The stock is trading at attractive valuations. Hence, we reiterate our BUY rating with a rolled forward target price of Rs. 480 based on 1.5x FY25E EV."

Disclaimer:
The stocks have been picked from the brokerage report of Geojit. Greynium Information Technologies and the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.