1. Nestle India: This packaged foods company hit its all-time high in share price of Rs 21,137 on Thursday after it posted a 24.7% YoY rise in net profit, to Rs 736.6 crore in Q4FY23. It has also beaten Trendlyne’s forecaster estimates, with revenue growing 21% YoY to Rs 4,830.5 crore on the back of double-digit sales growth across all product segments. This helps the company to show up in a screener of stocks where brokers upgraded recommendation or target price in the past three months.

According to its management commentary, the growth in sales in the domestic market was 21.2% YoY on the back of healthy pricing, high volumes and strong product mix. The packaged foods segment witnessed sales growth with the help of strong festive sales and consumer promotions. The confectionery segment also posted double-digit growth thanks to the rise in sales of Kitkat and Munch.

Sharekhan maintains its ‘Buy’ rating on the stock with a target price of Rs 22,990, indicating a potential upside of 11.3%. The brokerage believes that Nestle India’s strong positioning in the domestic food segment, improving out-of-home consumption, and penetration in rural markets will enable it to deliver  double-digit earnings growth in the long term. 

2. Voltas: This consumer durable stock has fallen 5% in trade after announcing its Q4FY23 results. Its net profit has dropped by 21% YoY to Rs 143.9 crore due to provisions for delayed collections in its international business. The company’s margins also decreased by 240 bps YoY to 7.4% in Q4. Voltas had to cancel a joint venture (JV) with Highly International, a Hong Kong company, as it did not get the necessary approvals. The JV was intended to set up a manufacturing unit to build compressors and reduce import dependency.

Analysts at Jefferies suggest that the benefit of lower commodity prices has not been passed on in pricing and this may lead to volume and margin growth for the company in FY24. However, Goldman Sachs has given a ‘Sell’ rating on the stock, as it missed net profit estimates. Trendlyne’s Forecaster suggests that Voltas missed the estimates by 4.1%. ICICI Securities gives a ‘Hold’ rating on account of Voltas losing market share to its peers. Its market share dropped to 21.9% in February, against 25.2% in FY21. 

On a positive note, revenue increased by 10.9% YoY to Rs 2,956.8 crore, as Q4 saw the early arrival of summer in India. The management expects better sales and margins in Q1FY24 and adds that the unitary cooling products business has performed relatively well, despite low consumer sentiment in March. The stock has gained nearly 8.5% in the past three months.

3. Bajaj Finance: This banking and finance stock has outperformed its Nifty Financial Services index by 2% in the past month. The stock rose 4.2% in the past week according to Trendlyne’s Technicals. The stock reaction came on the back of its Q4FY23 results, where it reported the highest-ever quarterly AUM addition of Rs 16,537 crore with 29% YoY growth. The growth was on account of higher lending in SMEs and the loan against securities segment.

Bajaj Finance’s profits increased by 30% YoY to Rs 3,518 crore, beating street estimates by 6%. The growth was on account of higher net interest margins (NIM), which remained flat at 10.6%, despite the cost of funds increasing substantially. Most analysts had expected the margins to contract. The firm also reported its lowest-ever net NPAs for the quarter at 0.34%. However, the provision coverage ratio of 64% gives room for further provisioning. The stock shows up in a screener for companies with consistently increasing profits for the past four quarters . 

Bajaj Finance’s management has guided FY24E with an AUM and profit growth of 26% and 23% respectively. On the negative side, management is expecting its gross NPA to increase from 0.94% currently to 1.4%-1.7% by the end of FY24.

Global Brokerage firm Jefferies has maintained its ‘Buy’ rating, stating that profit growth can be expected at a 26% CAGR, aided by loan growth. The NIM is expected to contract, but will be offset by increased operating efficiencies. Bajaj Finance’s foray into credit cards will be a game-changer.

4. IndusInd Bank: This bank’s share price fell 1.3% on Monday despite reporting strong Q4FY23 results. However, it has risen over 3% in the past three sessions till Thursday. It consequently features in a screener of companies with strong momentum scores. IndusInd Bank posted a 49.9% YoY increase in net profit to Rs 2,040.5 crore in the quarter. Its consolidated net interest income has also grown by 17.2% YoY, led by the corporate and retail banking segments. 

Commenting on the bank’s Q4 performance, Managing Director & CEO Sumant Kathpalia said that its loan growth accelerated to 21% YoY, led by retail deposit growth at 19% YoY. He also highlighted a new milestone, of the bank’s quarterly net profit crossing the Rs 2,000 crore mark for the first time. IndusInd Bank’s management has guided a 18-23% loan growth target for the next three years, FY23-26E.

Deposits grew 14.6% YoY led by retail deposits. The CASA ratio, however, declined to 40% from 42% in Q3FY23. The bank aims to increase the share of retail deposits to 48-50% by FY26E, driven by branch additions.

Although the bank reported healthy earnings in Q4, analysts are cautious due to the higher slippages QoQ, on account of MFI (microfinance institutions) loans and the downgrade of corporate restructured loans. KR Choksey maintains its ‘Buy’ rating on the bank, stating that the asset quality has been stable, despite the increase in the slippages during the quarter.

5. KPIT Technologies: This IT consulting & software company has risen 7.4% over two consecutive trading sessions since announcing its results on Wednesday, and touched its 52-week high of Rs 948.8 on Thursday. This uptrend was fuelled by its robust Q4FY23 performance despite the macroeconomic slowdown impacting Indian software companies. The company’s net profit rose by 41.5% YoY to Rs 111.6 crore, while its revenue jumped 56.1% YoY, led by healthy growth across business segments. The stock shows up in a screener for companies with revenues increasing sequentially for the past eight quarters. 

The company performed well in an environment where most Indian IT companies have battled a slowdown in international market growth.This mid-tier IT firm’s growth was driven by robust performance in the European and American segments. One reason may be that it is not directly exposed to the struggling international banking sector, as it primarily provides automotive software services. 

The US dollar revenue from the UK & Europe segment jumped 79.2% YoY, making it the largest contributor to the firm’s consolidated revenue in Q4. Its American segment grew 34.9% YoY, and revenue from the Asia segment declined by 10.1%

The management has set a conservative revenue growth guidance for FY24, similar to its peers, with a projected growth of 27-30%, which is lower than its growth guidance for FY23 (31-32%). However, the management is confident about its medium-term growth prospects on the back of healthy demand and a strong order book. 

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations.