Power Grid | JM Financial finds Power Grid’s valuations to be reasonable and hence has a price target of ₹383 on the stock with a “buy” rating. The brokerage believes that Power Grid has lower earnings risk given the regulated returns, along with a healthy dividend yield of around 4%. It also expects a sharp recovery in the transmission capex cycle and Power Grid to maintain a Return on Equity (RoE) of 18% between financial year 2024-2026. Slower than expected capitalisation of projects, rising competition for tariff-based competitive bidding are some key risks.

Bajaj Finance | JM Financial has a price target of ₹8,552 on Bajaj Finance. It called the company’s asset quality the best in class. Valuations too are reasonable with slightly below its long-term average. JM Financial sees a scope for re-rating considering its healthy Return on Equity along with Return on Assets with growth prospects ahead. Higher-than-expected slippages and credit costs, lower AUM growth are some key risks.

ICICI Lombard | The stock is trading at premium valuations but JM Financial expects it to compound with consistent growth of over 17% and RoE of over 17% as well. Although ICICI Lombard has seen a slowdown in growth after a strong start to the financial year, JM Financial advises using any seasonal weakness in numbers to be used as a ‘buying opportunity’. The brokerage has a price target of ₹2,450 on ICICI Lombard.

JSPL | JM Financial believes that JSPL’s strategic expansion will augment its crude steel capacity by 65% to 15.9 MT and enrich its product mix. The brokerage expects JSPL’s Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) per tonne to reach ₹15,000 by financial year 2026 considering its focus on margin expansion. JSPL’s balance sheet is also the strongest among domestic peers, according to JM Financial’s note. It has a price target of ₹1,500 on the stock.

NALCO | The state-run company’s EBITDA is likely to triple to ₹1,200 crore in the current quarter, supported by a rise in prices, lower costs and benefits of captive coal mining. The financial year 2027’s EBITDA estimate of ₹6,000 crore and 7.5x Enterprise Value to EBITDA along with a net cash balance of ₹3,500 crore, gives NALCO an equity value of ₹48,500 crore, through which, JM Financial arrives at its price target of ₹264 for the stock. At the current price, the brokerage called NALCO’s valuations attractive along with a 3% dividend yield. Sharp decline in international prices, delay in commissioning of alumina refinery expansion and lower-than-expected benefits of cost savings from captive coal mines are key risks.

Gravita India | JM Financial expects the company’s net profit to grow at a Compounded Annual Growth Rate (CAGR) of 30% over financial year 2024 – 2027, led by regulatory tailwinds in the domestic lead recycling space and capacity expansion plans. It also sees Gravita’s Return on Equity (RoE) and Return on Capital Employed (RoCE) of 32% and 28% respectively in financial year 2027. It has now raised its price target on Gravita to ₹3,068. Impact on volumes from any logistics disruption, delay in ramp-up of new capacities, volatility in aluminium prices impacting margins and country-specific risks for overseas expansions are some key hurdles.

Macrotech Developers | The brokerage expects Lodha to generate robust operating cash flow as collections catch-up to the growth seen in pre-sales over the last three years. Macrotech can raise Operating Cash Flow of ₹7,000 crore to ₹8,000 crore on average over the next three years. Macrotech is likely to have surplus cash for deleveraging even after accounting for an increase in business development investments, JM Financial’s note said. It has a price target of ₹1,480 on Macrotech. Prolonged slowdown in pre-sales and significant exposure to MMR market are key risks.

Olectra Greentech | JM Financial expects Olectra Greentech to re-rate to higher levels considering the strong long-term potential and a near-term ramp-up in volumes. Delayed clearances for big ticket projects, payment delays and labour shortage leading to execution in slowdown and slower-than-anticipated awarding especially from the government are key risks. JM Financial has a price target of ₹2,200 on Olectra Greentech.

Ashoka Buildcon | The company is likely to report a net profit CAGR of 33% over financial year 2024 – 2026 with a robust RoE of 10% in financial year 2026, JM Financial wrote in its note. At 15.3 times financial year 2026 standalone Earnings Per Share, JM Financial has a price target of ₹290 on the stock. Delays in finalising SPAs for HAM and BOT projects and low order inflows are some key risks.