02 Jun , 2022 By : Kanchan Joshi
Domestic brokerage Axis Securities continues to hold a positive long-term outlook on the market, supported by a favourable structure emerging as increasing Capex spending is enabling banks to improve credit growth.
The brokerage believes, aggressive policy tightening will help in curbing inflationary pressure, persistently elevated oil and commodity prices would continue to pose challenges to the market multiple in the next few quarters.
Axis Securities has recommend the following stocks as its top picks for the month of June 2022: ICICI Bank (target price: Rs1,000), Bajaj Auto (TP: Rs4,350), Tech Mahindra (TP: Rs1,700), Maruti Suzuki India (TP: Rs9,800), State Bank of India or SBI (TP: Rs665), Bharti Airtel (TP: Rs900), Cipla (TP: Rs1,125), Federal Bank (TP: Rs115, Varun Beverages (TP: Rs1,200), Ashok Leyland (TP: Rs160), Astral Ltd (TP: Rs1,900).
Its top stock picks also include Bata India (TP: Rs2,200), APL Apollo Tubes (TP: Rs1,100), HealthCare Global Enterprises (TP: Rs330), Praj Industries (TP: Rs477), CCL Products India (TP: Rs560).
The brokerage has rolled over its Nifty target to March 2023 to 18,400 by valuing it at 20x on FY24 earnings vs. 22x earlier. It has cut the Nifty multiple to accommodate the rising interest rate scenario, which started after a 40 basis points (bps) rate hike by the Reserve Bank of India (RBI) in early May 2022.
“The current India volatility index or VIX is trading around LTA levels and the clear trend is likely to emerge only after the volatility stays at the lower levels for a longer time. Keeping these developments and overall weaker global cues in view, we expect the market performance to remain range-bound in the near term," the note stated.
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