This week we take a look at how accurate analysts have been in predicting a stock’s share price growth. We look at analyst buy calls from March 2022 to see if the stocks they chose beat their target prices in the months that followed.
- TVS Motors: This two-wheeler manufacturer was trading at Rs 625.7 on March 31, 2022 and has risen by 57.5% since. It is currently trading at Rs 985.6.
In March, multiple analysts and brokerages were bullish on the company. Brokerages like Prabhudas Lilladher, IDBI Capital, Geojit, Chola Wealth, and Axis Direct gave a ‘Buy’ rating to the motor company in March with target prices ranging from Rs 669 to Rs 751, with an average broker upside of 8.3%.
In the months that followed, TVS outperformed all these targets. Analysts were positive on the company on the back of new product launches, aggressive plans in the eclectic vehicles segment, and the domestic market recovery post-Covid-19 lockdown.
- Eicher Motors: This truck and two-wheeler manufacturer’s stock was trading at Rs 2,457.1 on March 31 2022. Since then it has risen by 36.7% to Rs 3,358.7.
The average target price in March for Eicher was Rs 2,852.9 and the average broker target upside was 8.8%. Brokerages like Prabhudas Lilladher, Motilal Oswal, and Geojit BNP Paribas had a ‘Buy’ rating on Eicher as of March 2022. Their target prices ranged from Rs 2,569 and Rs 3250. Since then, the stock has exceeded these target prices and easily beat the average broker upside of 8.8%.
The analysts were positive on the company’s prospects given the new launches, geographic expansion, ramp-up of exports, and easing of supply chain issues.
- Bajaj Auto: This two-wheeler stock was trading at Rs 3,653 in March 2022, and since then it has increased by 11.8% to Rs 4,084.8. Quite a few brokerages were optimistic about this auto manufacturer’s prospects in March. The average target price was Rs 4,072.6 and the average broker target upside on the stock was 7.9%.
In March, brokerages like Geojit BNP Paribas, Axis Direct, Prabhudas Lilladher, Sharekhan, HDFC Securities, and LKP Securities had a ‘Buy’ call on the company. Among these calls, the stock met the target price of Geojit BNP Paribas and Prabhudas Lilladher, whose targets were Rs 4,040 and Rs 3,911, respectively. The company has also beat March’s average broker target upside of 7.9%.
Analysts were bullish on the auto stock on the back of growth in demand in the three-wheeler segment, new product launches, increase in production capacity, and rising exports. They expected the company to increase its market share both domestically and internationally.
- Reliance Industries: This conglomerate’s stock was trading at Rs 2,634.7 on March 31, 2022, and since then it has risen by just 0.1% to Rs 2,637.9. Many brokerages had a positive outlook on the company’s prospects in March this year. The average target price from analysts in March was Rs 2,833.8 and the average broker upside on the stock was 2.6%.
Brokerages like Prabhudas Lilladher, ICICI Securities, Motilal Oswal, and Geojit BNP Paribas gave a ‘Buy’ rating to the refinery company despite its high valuation, and target prices ranged from Rs 2,758 to Rs 3,045. Reliance did temporarily beat the average broker upside of 2.6%, when it touched Rs 2,819.8 in April 2022. However the price has fallen since then.
Analysts were bullish on this stock given its robust cashflows and balance sheet enabling it to make strategic investments across business sectors. They also expected Reliance Jio’s average revenue per user to increase and the company’s retail business to expand leading to higher revenue.
- Sun Pharmaceuticals: This pharmaceutical company’s share price on March 31, 2022 was Rs 914.8. The average target price was Rs 993.7 indicating an upside of 9.7%.
Sun Pharma is currently trading at Rs 893.1, down 2.4% since March 2021. However, it met various targets from analysts as it hit its five years high of Rs 967.1 on April 29, 2022.
Brokerages like Edelweiss, Geojit, and ICICI Direct had a ‘Buy’ call on the pharma company with target prices of Rs 940, Rs 948, and Rs 965. The stock met these targets along with a target from Motilal Oswal of Rs 960, after which the brokerage set a new target price of Rs 970. Targets from brokerages like HDFC Securities, Prabhudas Lilladher, and BOB Capital Markets which are above Rs 970 are yet to be reached.
The analysts were positive on the stock because of its diversification in the United States and Canada market into specialty products like Ilumya, Levulan, BromSite, Cequa, Xelpros, etc.
You can track analyst calls with this screener. To see calls in previous months and quarters, use the Screener Rewind feature on this screener.
Note: These recommendations are from various analysts and are not recommendations by Trendlyne.
