Tailwinds of festive season and cricket world cup: 5 QSR stocks with upside potential of up to 27%

In the last three years, many sectors and companies which have been in the dumps for years have made a comeback. There are two kinds of comebacks, one is comeback on the dalal street. Second is a comeback in the real business. It is the second one which is more important as that is what finally matters to even the street. If one looks at the history of the liquor industry it has been dominated by two large names, but over the last few years, many smaller companies have made a comeback in a real business sense. Some due to their one brand getting super successful, others have been able to restructure their operation, reduce debt by selling some of the non core assets. Some by becoming bottlers and outsourcing their capacity to large players. In a nutshell, after two decades of ups and downs, these smaller players have reached the point where there is a possibility that they might see a re-rating, if they stay in course of clean and transparent corporate governance.

In volatile markets, where there is a readjustment in valuation across midcap space, it is only a matter of time that the concept of relative valuation will come into play and large caps will get more attention from the market. Stocks from different sectors are making to the list, this week, stocks from Oil refining and marketing, private banks, insurance, auto ancillary and fertilizer space. ET screener powered by Refinitiv’s Stock Report Plus lists down quality stocks with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy . The screener applies different algorithms for all BSE and NSE stocks.

Every industry has different operating conditions which have high correlation with the kind of ROE companies in the industry generate. The bigger question is how sustainable that number is. Of all the stocks, which our algorithms come up with, we took companies from, FMCG, software, financial services and speciality chemical. ET screener powered by Refinitiv’s Stock Report Plus lists down stocks with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy .

Despite the recent correction, valuations are still high from every perspective. Because they have stayed at elevated levels, to some it might appear as a new normal. But the fact is that stretched valuations have never been and never will be the new normal. So, sooner or later, the street will start the process of valuation adjustment. First signs that markets are getting close to starting the process are clearly visible on the wall. Adjustment of valuations is a process, which does not end in one day, though it starts in one day. It would be worthwhile to make adjustments to the portfolio by shifting to more defensive sectors. ET screener powered by Refinitiv’s Stock Report Plus lists down mid and small cap stocks from the FMCG sector with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy .

Despite the fact the valuations are high and there are many headwinds both in terms of geopolitical risk and central banks policy making, the correction which is taking place in the market is not of the same magnitude which in the past such mews flow has brought. So at one level while the correction is taking place but at the same time, the under current is still that of hope. In such times of divergence, it would be better to add the words like portfolio rejig, caution, fundamentals and valuations to one’s thought process while buying stocks. Refinitiv’s Stock Report Plus which lists stocks with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy .

At a time when worrying about what will happen to the global financial markets is the norm, it is better to stay focussed on long term wealth creation and companies which have the right combination to make it. Of all the stocks, which our algorithms come up with, we took companies from four sectors: defence, FMCG, agrochemical and natural resources. ET screener powered by Refinitiv’s Stock Report Plus lists down stocks with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy .

After a long phase of three years of consolidation and relative underperformance, there were some initial signs of the private sector banks making a comeback attempt. There have been reasons for their underperformance, right from mega merger which created a technical issue of overhang in shareholding, to changes in the top management. Also the fact that these stocks came in the over owned category of foreign institutional investors, who have been sellers time and again.

Every industry has different operating conditions which have high correlation with the kind of ROE they generate and how sustainable that number is. Of all the stocks, which our algorithms come up with, we took companies from three sectors, biologics, engineering and an auto ancillary company which is focussed on EV space and has been able to get an early lead. ET screener powered by Refinitiv’s Stock Report Plus lists down stocks with high upside potential over the next 12 months, having an average recommendation rating of “buy” or strong buy .

Textile is one of the oldest industrial sectors in India. However, right from labour issues to smaller Asian countries becoming more competitive in terms of cost of production, different segments of the textile industry have faced more headwinds than tailwinds in their history of existence. This list is drawn from Stock Reports Plus, powered by Refinitiv, with over 4,000 listed stocks along with detailed company analysis focusing on five key components - earnings, fundamentals, relative valuation, risk and price momentum.

Elixir Equities Director, Dipan Mehta, argues that new age companies such as Zomato, Policy Bazaar, Nykaa, and Paytm are stocks of the decade of the 2030s and could be huge multibaggers over the next 5-10 years. However, these companies are still in their investment phase, which reflects in their P&L, although they are making strong efforts to get into EBITDA positive. Regarding concerns about Page's decline, Mehta suggests that a demand slump due to higher inflation and uncertainty around weather patterns may have impacted Page industries.