Multibagger Stock: The metal sector’s top stock recommendations by domestic brokerage and research firm ICICI Securities include Tata Steel, Hindalco and Graphite India. And said this while sharing a note on Result Preview for Mining Sector.
The brokerage has given ‘Buy’ rating on Hindalco with a target price of Rs 525 per share. It has a ‘Buy’ rating on Graphite India with a target price of Rs 825 while it has a ‘Buy’ rating on Tata Steel with a target price of Rs 1,750.
In its metals and mining coverage, ICICI Securities has also given buy ratings on JSW Steel (Target Price Rs 850), NMDC (Target Price Rs 210), Ratnamani (Target Price Rs 2400), Tata Metaliks (Target Price Rs 1,475) while It has a ‘hold’ stance on Coal India (target price Rs 160).
For the second quarter, ICICI Securities expects Tata Steel’s topline to grow 62% year-on-year and 13% QoQ on a consolidated basis to Rs 60,254 crore. Consolidated EBITDA for Q2FY22 is expected to grow by 25% QoQ and 231% YoY to Rs 20,212 crore. The brokerage note said that the consolidated EBITDA margin is expected to come in at 33.5% (as compared to 30.2% in Q1FY22).
Meanwhile, for Q2FY22E, the brokerage firm expects Hindalco’s domestic operations (standalone operations + Utkal) to topline 65% YoY, 18% QoQ. Also, the EBITDA margin is expected to come in at 18.4% (13.3% in Q2FY21, 19.6% in Q1FY22). Novelis is likely to report sales volume of 974 KT and EBITDA/tonne of US$550/tonne.
Graphite India is expected to report consolidated topline growth of 47% YoY, 17% QoQ. ICICI Securities expects the company to report consolidated EBITDA of Rs 231 crore (64% QoQ) and consolidated net profit of Rs 224 crore (up 49% QoQ).
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