Top Picks: Prabhudas Lilladher Sees 3 Metal Stocks Rising, Buy Call Assigned

Prabhudas Lilladher has assigned buy call to three leading metal and ferrous sector stocks. These stocks are Hindalco Industries, Jindal Steel & Power, and Tata Steel. According to the analyst, "We expect our metals coverage universe to report healthy performance in 2QFY24, owing to lower raw material and energy prices, continued strong demand momentum despite seasonally weak monsoon quarter and weak base of 2QFY23. We expect overall EBITDA/ PAT growth of ~48%/ 179% YoY (2%/ -5% QoQ) for our coverage universe (ex-JDSL). Key monitorables would be rising coking coal prices, progress on capex, outlook on demand from China & developed countries."

Buy Hindalco Industries Shares: Prabhudas Lilladher has assigned buy call to Hindalco shares with target price of Rs 557 apiece. Current market price of Hindalco Industries is Rs 472.40 per share on BSE with intraday gain of 0.01%. Its 52-week high price is Rs 508.80 per share and 52-week low price is Rs 379.90 per share, respectively. Hindalco Industries has a market capitalisation of Rs 1,06,158.51 crore. Hindalco Industries shares soared 12% in last 3-months, fell over 3% YTD, gained 16% in last 6-months, rallied 15% in last 1-year and in last 3-years soared 178%.

Buy Jindal Steel & Power Share: The analyst has assigned buy rating to Jindal Steel & Power Ltd with target price of Rs 812 per share. Current market price of Jindal Steel share on BSE is Rs 675.10 per share with intraday fall of 1.20%. Its 52-week high price is Rs 722.15 per share and 52-week low price is Rs 424.60 per share, respectively. The company has a market capitalisation of Rs 68,901.85 crore. Jindal Steel shares fell 3.25% in last 1-month, gained 24% in last 6-months, soared 51% in last 1-year, and offered a return of 248% in last 3-years.
As per the analyst, "We remain positive on JSP given 1) strong 16% CAGR in steel volumes over FY23-26E led by ongoing Angul capacity expansion, 2) commissioning of 5.5mtpa Hot Strip Mill to improve product mix, and 3) its margin improvement projects such as 12mtpa pellet plant, 18mtpa slurry pipeline and four coal blocks to drive margins."

Buy Tata Steel: The brokerage firm has recommended investors to buy Tata Steel shares with target price of Rs 144 per share. Current market price of Tata Steel stock on BSE is Rs 124.30 per share with intraday fall of 1.27%. Its 52-week high price is Rs 134.85 per share and 52-week low price is Rs 98.10 per share, respectively. The large cap company has a market capitalisation of Rs 1,51,954.55 crore. Tata Steel shares fell 4% in last 1-month, soared 20% in last 1-year, rose 235% in last 3-years, and fell over 4% in last 2-years-time.

According to the analyst, "We remain positive given 1) strong double digit volume growth potential for TSI post commissioning of 5mtpa KPO II by 1QFY25, 2) better clarity on TSUK with GBP 500mn grant from the UK govt. for 3mtpa EAF and reduction of losses from TSUK, and 3) focused deleveraging to keep balance sheet healthy. Maintain Buy with TP of Rs144."

Disclaimer:

The stocks have been picked from the brokerage report of Prabhudas Lilladher. Greynium Information Technologies, 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 check with certified experts before taking any investment decision.