ICICI Direct’s Top 5 Stocks for Long-Term: ICICI Direct has provided a list of five stocks recommended for long-term investors for the month of July 2024. In this article, we will give a detailed overview of these stocks, including their target prices and time frames as provided by ICICI Direct. Please ensure that you do not invest blindly in these stocks; conduct your own research and invest accordingly.
ICICI Direct’s Top 5 Stocks for Long-Term
VA Tech Wabag Limited (WABAG)
Current Market Price (CMP): ₹1230 | Target Price: ₹1550 | Potential Upside: 21% | Rating: BUY
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VA Tech Wabag is a global leader in the water management sector, ranked third worldwide. The company offers a range of water solutions including desalination, drinking water treatment, municipal water treatment, sludge treatment, and industrial wastewater treatment. With a return on capital employed (ROCE) of 19% in FY24 and free cash flow of ₹168 crore, Wabag’s asset-light model demonstrates strong financial health. The company holds an order backlog of ₹11,400 crore, ensuring solid revenue visibility. As international projects worth $1 billion materialize, order inflows in FY25 are expected to be robust. Revenue, EBITDA, and PAT are projected to grow at CAGRs of 14%, 22%, and 25% respectively from FY24 to FY26, positioning the company for significant operational and financial improvements.
PCBL Limited (PCBL)
Current Market Price (CMP): ₹277 | Target Price: ₹340 | Potential Upside: 19% | Rating: BUY
PCBL Limited is a leading carbon black manufacturer serving the tyre industry and deriving a portion of its revenue from specialty carbon black, which commands higher margins. The company recently commissioned a new plant in Tamil Nadu with a capacity of 150,000 tonnes, targeting full utilization by FY25 due to strong export opportunities. With plans for further expansion, PCBL aims to increase its export share in total sales volume to 42% by FY26. Specialty carbon black volumes are expected to grow at an 18% CAGR, driven by high-margin products used in paints and plastics. Improved EBITDA margins and a stable return on equity (RoE) of around 15% make PCBL a promising investment.
Just Dial Limited (JUSTDIAL)
Current Market Price (CMP): ₹1230 | Target Price: ₹1500 | Potential Upside: 18% | Rating: BUY
Just Dial has shown strong performance with a revenue increase of 13.6% YoY to ₹280.57 crore in Q1FY25. The company is enhancing its focus on the B2B segment, which currently contributes about 26% to revenues. This segment offers better monetization opportunities, and Just Dial aims to increase its B2B revenue share to one-third of total revenues. The management has provided a positive outlook with expected mid-teen revenue growth and EBITDA margins of 27.7%-28.4% for FY25 and FY26. A significant positive development is the company’s plan to distribute its annual profits more efficiently, utilizing over ₹4.5k crore of excess cash.
NTPC Limited (NTPC)
Current Market Price (CMP): ₹370 | Target Price: ₹455 | Potential Upside: 19% | Rating: BUY
NTPC, India’s largest power generation company, has an installed capacity of approximately 76,000 MW. The company aims to expand its capacity to over 130 GW by 2032, with 60 GW from renewable sources. NTPC’s coal-based capacities have been a growth driver, with 9,300 MW under construction. The company is also aggressively expanding its renewable energy portfolio, aiming for nearly 45-50% of its capacity from non-fossil fuels by 2030. This includes significant projects in green hydrogen and nuclear power. With a strong focus on renewable capacity addition and solid growth in its thermal portfolio, NTPC is poised for substantial growth, projecting a 26% CAGR in PAT over FY24-26.
Gabriel India Limited (Gabriel)
Current Market Price (CMP): ₹475 | Target Price: ₹600 | Potential Upside: 21% | Rating: BUY
Gabriel India, a top-10 global shock absorber manufacturer, serves the two-wheeler, three-wheeler, passenger vehicle, commercial vehicle, railway, and aftermarket segments. The domestic auto industry’s recovery, particularly in the two-wheeler segment, positions Gabriel for growth. The company holds a significant market share in the electric two-wheeler space and aims to expand in the SUV segment through a joint venture with Inalfa. With a robust presence in the EV market and a focus on premium products like sunroofs, Gabriel India is expected to achieve double-digit margin growth, with sales and PAT projected to grow at 9% and 24% CAGRs respectively over FY24-26.
ICICI Direct’s Top 5 Stocks for Long-Term Summary Table
| Company Name | CMP (₹) | Target Price (₹) | Potential Upside (%) | Rating |
|---|---|---|---|---|
| VA Tech Wabag Limited | ₹1230 | ₹1550 | 21% | BUY |
| PCBL Limited | ₹277 | ₹340 | 19% | BUY |
| Just Dial Limited | ₹1230 | ₹1500 | 18% | BUY |
| NTPC Limited | ₹370 | ₹455 | 19% | BUY |
| Gabriel India Limited | ₹475 | ₹600 | 21% | BUY |
This article provides a comprehensive overview of the top five stocks recommended by ICICI Direct Research for July 2024, highlighting key financial metrics, growth projections, and strategic initiatives for each company. Remember, do not invest blindly in these stocks. Conduct your own research and invest accordingly.