Five Interesting Stocks Today

This healthcare facilities firm has been in the news after announcing a Rs 1,000 crore super speciality hospital in Kolkata, leading to a 3.3% rise in its stock on November 21. According to Trendlyne’s Technicals, the stock rose 8.2% over the past week, outperforming the Nifty Healthcare index by 6.6%. The outperformance was due to its lower valuation compared to peers, improved profitability of its newer hospitals post-expansion, and upcoming growth plans in both domestic and Cayman Island hospitals.

In Q2FY24, the company’s revenue improved by 14.3% YoY, backed by rising average revenue per patient. The company’s EBITDA margins increased by 230 bps YoY, driven by increased revenue realization per bed in its domestic and Cayman Island hospitals. The company appears in a screener of stocks with growing quarterly net profit and margins.

The management plans a capex of Rs 1,140 crore in FY24, having already invested Rs 394 crore in H1FY24. The capex will focus on technological upgrades for better patient care and operational efficiency, as well as development in the Cayman Islands. Revenue growth was observed in new hospitals, with improved EBITDA.

Prabhudas Lilladher says that the company comes at an attractive valuation compared to its peers. The ramp-up in its Cayman unit, which will be operational in H1FY25, will be key. The broker maintains a ‘buy’ rating on the company.

2. CG Power and Industrials:

This heavy electrical equipment manufacturer’s shares have surged to a record high of Rs 498 each, with a 20% rise on Wednesday alone. The rise follows the Murugappa Group company's announcement that it is seeking approval to set up a semiconductor assembly unit – an area where the Indian government has long aspired to be a key player.

In its regulatory filing, CG Power said it had applied to the Ministry of Electronics and Information Technology (MeitY), proposing a project with an outlay of Rs 6,592 crore over the next five years. The project is part of a scheme offering 50% capex support from the Centre.

In Q2FY24, the firm reported a revenue growth of 19.5% YoY to Rs 2,000 crore, beating Trendlyne’s Forecaster estimates by 1.6%. Its net profit also rose by 35.4% YoY to Rs 242 crore. Due to its success in generating cash, the firm appears in a screener of stocks with improving cash flow from operations. According to Trendlyne’s Forecaster, the company’s annual revenue is expected to rise by 17.8% in FY24.

The management has approved capacity expansion in both the industrial and power systems segments at multiple units in Bhopal, with an investment of Rs 35 crore. A similar expansion plan has been approved for units in Nashik, with an investment of Rs 155 crore. Geojit BNP Paribas expects the company to incur a capex of Rs 500 in FY24 and FY25, driven by strong domestic order book.

3. Welspun Corp:

This iron & steel products company has been on the rise over the past month, touching its 52-week high of Rs 562.9 per share on November 21. The surge is on the back of strong results, new order wins, and approvals for expansion. Its stock price has risen by 25.6% over the past month, featuring in a screener of stocks with prices above short, medium and long-term moving averages.

The stock rose by 8.5% on November 12 after its associate company, East Pipes Integrated Company for Industry (EPIC), signed a contract worth approximately Rs 1,000 crore with Saudi Aramco. The contract involves supplying large-diameter steel pipes to Aramco for the next 13 months.

The company’s subsidiary, Sintex BAPL, also received approval from the government of Odisha to invest Rs 479.5 crore in a new pipe manufacturing unit in Sambalpur on Wednesday. The facility, set to have a production capacity of 37,520 MT per annum, is expected to become operational in the next three years.

Welspun Corp also posted a net profit of Rs 384.7 crore in Q2FY24 compared to a net loss of Rs 56.6 crore in Q2FY23. Its revenue surged by 106.7% YoY to Rs 4,059.4 crore, thanks to improved sales in the pipeline and building materials segments. Trendlyne’s Forecaster expects the company’s revenue to grow by 49.9% YoY and net profit to surge by 4.6x YoY in FY24.

Commenting on its latest order wins, Vipul Mathur, MD and CEO of the company, said, “Our associate company, EPIC in Saudi Arabia has a confirmed order book exceeding two years. The execution of the recent Aramco order, valued at SAR.1.8 billion (approximately Rs 4,000 crore), has started.”

4. Aurobindo Pharma

This pharmaceutical company touched an all-time high of Rs 1,043 on Wednesday (November 22), following the US FDA approval of the anti-cancer drug, Ryzneuta, developed by its subsidiary Acrotech Biopharma. The global market size of the drug is approximately $6 billion. Aurobindo Pharma’s share price has risen by 5.8% in the past week, further boosted by a successful US FDA inspection at the manufacturing facility of another subsidiary, APL Healthcare, which resulted in zero observations. As a result, it features in a screener of stocks with the highest recovery from their 52-week lows.

Over the past month, the stock has risen by 18.1%, outperforming its industry. Its net profit in Q2FY24 surged by around 85% to Rs 757.2 crore, while the EBITDA margin expanded by 485 bps YoY to 19.4%, driven by low material cost and a favourable product mix. According to Santhanam Subramanian, the Chief Financial Officer, “We are on track to achieve the 20% plus EBITDA margin target set internally for the year.”

Aurobindo Pharma’s revenue has grown by 25.7% YoY, led by healthy performance in the formulations and API (active pharmaceutical ingredients) businesses (up 29% YoY and 20.3% YoY, respectively). During the quarter, the revenue from US formulations (excluding Puerto Rico) increased by 35.7% YoY to Rs 3,385 crore, driven by volume growth, stable demand, and new product launches.

KR Choksey maintains its ‘Accumulate’ rating on Aurobindo, with an upgraded target price of Rs 1,090. The brokerage is optimistic about the company’s strong pipeline of 40 new products slated for launch in the next 12 months, providing growth opportunities in existing and new businesses.

5. UNO Minda:

This auto parts manufacturer hit its all-time high of Rs 694.7 on Friday, marking a rise of 17% since the announcement of its Q2FY24 results on November 7. Its profit has increased by 32.3% YoY to Rs 225 crore, while its revenue grew by 25.5% YoY to Rs 3,630.2 crore. It beat Trendlyne Forecaster’s net profit and revenue estimates by 9.9% and 6%, respectively. Its EBITDA margin improved by 42 bps sequentially to 11.1%, due to a fall in employee and other expenses.

The growth in Q2FY24 has been on the back of continued capacity expansion and market share gains. The company also witnessed growth across all product verticals. The switch segment, which accounts for 28% of total revenue, grew by 26% YoY, while the lighting and casting segments increased by 23% and 21%, respectively. The company features in a screener for stocks with low debt.

For FY24, UNO Minda has planned a capex of around Rs 700-800 crore. The firm commissioned its electric vehicles component and systems plant in Q2FY24. According to ICRA, EV penetration is expected to double from the current 2-3% to 4-6% by FY25, which will potentially increase the company’s orders from original equipment manufacturers.

UNO Minda has approved the setting up of a new greenfield plant with a capacity of 1.2 lakh alloy wheels per month, responding to strong demand as the existing capacity is fully utilised. According to the management, “The new plant will lead to a potential 2-3X growth over the next seven years.”

Axis Securities upgraded its rating on UNO Minda to ‘Buy’, citing continued outperformance and consistent execution capabilities. It forecasts revenue and profit CAGR of 15% and 19% respectively, over FY24-26.

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