State Bank of India | India’s largest lender is equipped to sustain growth given its liquidity surplus and a comfortable LDR, according to HDFC Securities. It is also anticipating SBI’s NIMs to compress over financial year 2024-2026 due to a turn in rate cut cycle in the second half of the current financial year. It recommends buying SBI in a price band of ₹733 – ₹813 for a price target of ₹960 until the next Diwali. Higher-than-expected deterioration of asset quality, unfavourable regulatory changes, slowdown in credit growth are some key risks.

Bank of India | Bank of India has a strong capital adequacy ratio, better NIMs and enhanced asset quality, as per HDFC Securities, who called the lender’s valuation of 0.6 times financial year 2026 adjusted price-to-book value as an “attractive entry point.” It recommends buying the state-run lender in the ₹96 – ₹106 price band, for a price target of ₹132 till the next Diwali. Deterioration in Agri and SME segment asset quality, lower-than-expected resolutions of stressed assets and implementation of old pension scheme to employees are some key risks.

JK Lakshmi Cement | HDFC Securities expects cement demand to pick up in the second half of the financial year. It expects a healthy operational performance from JK Lakshmi Cement, taking into considering the capacity expansion put in place by the company. It expects JK Lakshmi’s revenue, EBITDA and net profit to increase at a Compounded Annual Growth Rate of 7.6%, 15.7% and 13.9% respectively over financial year 2024 and 2026. It recommends buying the stock in the ₹738 – ₹819 price range for a price target of ₹936 until the next Diwali. Soft cement demand and delay in capacity expansion plans are some key risks.

Jyothy Labs | HDFC Securities hailed Jyothy Labs’ transformation from a promoter-driven, south-centric, single-product entity to a professionally managed and multi-product company operating nationwide. Better product mix and improving operating efficiencies are driving margin improvement. HDFC Securities expects Jyothy Labs to report a revenue, EBITDA and profit CAGR of 12%, 15% and 17% respectively over financial year 2024 and 2026. It recommends buying the stock in the ₹480 – ₹533 range for a price target of ₹600 till next Diwali. Any impact of unfavourable monsoons, prolonged inflation, household insecticides decline, inflationary trends in raw materials and competitive intensity are some key risks.

L&T Finance | The non-bank lender may report an 18% growth in advances over financial year 2024 – 2026, according to HDFC Securities. It called the stock’s valuations “reasonable” over possible asset quality hiccups in wholesale lending though the focus on this business is failing. It recommends buying the stock in the ₹153 – ₹170 range for a price target of ₹219 till next Diwali. Microfinance or farm equipment stress, increase in share of retail loans by peers, higher borrowing costs are some key risks.

NALCO | NALCO is well positioned to benefit from the strong Alumina prices, according to HDFC Securities. “We expect a firm and strengthened aluminium price outlook due to the tightness in global supply and recovery in demand,” HDFC Securities said in its note. The brokerage anticipates NALCO’s revenue, EBITDA and profit to grow at a CAGR of 9.7%, 32.8% and 29.2% over financial year 2024 and 2026. It recommends buying the stock in the ₹198 – ₹220 range for a price target of ₹270 till next Diwali. Aluminium and Alumina price volatility, regulatory changes, raw material inflation are some key risks.

Navin Fluorine | Navin Fluorine’s revenue is likely to grow at a 23.5% CAGR led by robust growth from the CDMO and Specialty Chemical segment over financial year 2024 and 2027, HDFC Securities said, who also anticipates a 750 basis points expansion in margins over the next three years led by better product mix and scale up of the Specialty Chemicals business. The management too expects margins closer to 25% levels by the end of the current financial year. Revenue growth and margin improvement can drive a 35% net profit CAGR over a three-year period. The brokerage recommends buying Navin Fluorine in the ₹3,059 – ₹3,396 range for a price target of ₹3,948 till next Diwali. Raw material price fluctuation, Chinese competition, cyclicality of the business, delay in expansion ramp-up, delay in scale-up of CDMO business are key risks.

NCC | The stock in which Rekha Rakesh Jhunjhunwala also has a stake can benefit from positive tailwinds with the government’s focus on infrastructure development by various schemes. Given the all-time high order book, execution ramp-up, and robust balance sheet, HDFC Securities expects NCC to report healthy growth in the medium-term. NCC may report a revenue, EBITDA and profit CAGR of 16%, 21% and 39.6% respectively over financial year 2024 – 2026, as per the brokerage, who recommends buying the stock in the ₹273 – ₹303 range for a price target of ₹363 till the next Diwali. Cost and time overruns, raw material price volatility are some key risks.

PNB Housing | HDFC Securities is projecting a 18% CAGR in PNB Housing’s loan book over financial year 2024 – 2026, while its Net Interest Income and Net profit are likely to grow by 16% and 15% respectively over the same period. Its Return on Assets may also improve to 2.2% by financial year 2026. The brokerage recommends buying the stock in the ₹893 – ₹991 range for a price target of ₹1,160 till next Diwali. Unfavourable changes in regulatory policy, intense competition, lower-than-expected loan growth and lower NIMs are key risks.