7 largecap stocks that can deliver up to 25% returns in a year

The brokerage house believes that the bank has been outperforming its peers and has been firing on all cylinders. ICICI Bank has ticked most boxes on growth, margins, and asset quality. Higher loan growth, improving operating profits, and a strong provision buffer coupled with a strong deposit franchise will help the bank achieve ROAE/ROAA expansion over FY23-25E. On the valuation front, it believes that the bank continues to be on a comfortable footing.

The company’s EBITDA margins have been healthy and stable averaging 25% over the last decade. This has been on account of abundant coal resources, conducive geological conditions, the company’s improving productivity in terms of output/man-shift due to manpower reduction through the closure of underground mines, higher outsourcing, and capex on open cast mines and evacuation expenditure, the brokerage said.


"Higher international coal prices and volume growth and CIL's focus on closing the non-profitable manpower intensive high-cost underground coal mines and expanding the large open cast mines will drive the profitability," it added.

Axis Securities believes Tech Mahindra has a superior services mix and multiple long-term contracts that are well-spread across the verticals, reducing its dependency on any one vertical. Furthermore, it foresees healthy tractions in Communications and Enterprise verticals which will greatly accelerate the company’s revenue growth moving forward.

The brokerage firm expects gross margin to improve going forward, driven by a fall in the price of commodities, and the yen being devalued in comparison to the Rupee/Dollar. In addition, volume ramp-up will bring in operating leverage, it said. It added that the new launches, targeted at filling the gaps in its SUV portfolio, are likely to improve the overall product mix. The company would gain further market share, driven by an expected shift towards petrol, Hybrid & CNG vehicles.

Amongst the PSU banks, SBI remains the best play on the gradual recovery of the Indian economy on account of its healthy PCR, robust capitalization, a strong liability franchise, and an improved asset quality outlook, the brokerage said. We believe normalization in credit costs and improved growth outlook should lead to double-digit ROEs of 14-15% over FY23-24E, it added.

Axis Securities believes that the company’s digital initiatives and business transformation are key positives to look forward to and are currently progressing well with sequential improvement visible across metrics. It believes the marginal compression in NIMs will be offset by improved fee income, improving Opex ratios, and stable credit costs thereby enabling BAF to deliver superior return ratios.

"CIPLA continues to focus on the demand levers in the chronic and acute therapies and complex products in its existing as well as pipeline portfolio (for the branded and generic markets of India and South Africa). The company’s active advancement of innovative consumer-centric products is expected to accelerate the augmentation of the global consumer wellness franchise across both India and South Africa," the brokerage firm said.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)