Diwali Stocks- Tata Motors, L&T amongst top 5 performers during Samvat 2079
Tata Motors Ltd, Larsen & Toubro stand amongst top 5 Sensex gainers since last Diwali. The share prices of Tata Motors and Larsen & Toubro have gained 55-61% during samvat 2079 till date (i.e since Diwali last year)
The strong pickup in economic activity has been supportive for Tata Motors and Larsen & Toubro. For Tata Motors the pickup and improvement in domestic commercial vehicle demand as well as continued momentum in personal vehicles segment remains a key growth driver. The Jaguar Land Rover (JLR) sales too have picked pace. The declining input costs too have added to earnings growth and forward earnings upgrades too . Kumar Rakesh at BNP Paribas said that We raise our FY25-26E EBITDA by about 2% to bake in 2Q results and management commentary.
Meanwhile Larsen and Toubro Ltd (L&T) too has remained key beneficiary of rising government capex and some uptick in private Capex. The order book has risen regularly. During H1FY24, L&T had registered an order inflow (OI) of ₹1.5 trillion up 65.1% YoY), taking the order book as of September’23 to an all-time high of ₹4.5 trillion (2.5 times FY23 revenue). For L&T too the bottoming out of margins can drive further earning upgrades. Analysts at HDFC securities said that given the record-high order book, bottoming out of infra margins, improvement in subsidiary performance; and higher public capex towards a green economy, they maintain positive stance on the stock.
Share price of NTPC Ltd with gains of around 42%, UltraTech Cement with gains of more than 35% and IndusInd Bank with gains of almost 29% are amongst other top gainers during Samvat 2079. The strong power demand in the country and rising installed capacity and renewable portfolio has meant that NTPC remained amongst investor favorites. The Cement demand has remained robust and UtraTech Cement, the largest cement manufacturers, also benefitted gaining market share. Analysts at Axis Securities Expect the company to grow its volume, revenue , Ebitda, Net profit at a CAGR of 12%,13%,27% and 41% respectively over FY23-FY25, driven by the robust demand, improvement in prices, upcoming new capacity, ramping up of recently commissioned capacity, benefit of lower commodity prices, higher blending ratio, and increasing share of green energy.
IndusInd Bank has been key beneficiary among banking stocks that are seeing regular credit growth, improved asset quality and rising net interest margins.
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