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The Indian economy stands in a sweet spot of growth and remains the land of stability against the backdrop of a volatile global economy, said Axis Securities which continues to believe in the long-term growth story of the Indian equity market supported by the favourable structure emerging with increasing Capex enabling banks to improve credit growth. 

“Strong earnings trajectory continues in the Nifty 50 universe. We foresee NIFTY EPS to post growth of 11%/14%/13% in FY23/24/25. Thus, we roll over the NIFTY target to December 2023 at 20,400 by valuing it at 20x on December 2024 earnings, implying an upside of 9% from the current levels," the note stated.

While the medium to long-term outlook for the overall market remains positive, the brokerage said we may see volatility in the short run with the market responding in either direction. In this context, the current setup is a ‘Buy on Dips’ market. “We recommend investors maintain good liquidity (10%) to use such dips in a phased manner to build a position in quality companies (where the earnings visibility is very high) and with an investment horizon of 12-18 months," it suggested.

Based on the above themes, the brokerage has suggested following as top stock picks for the month of December which include ICICI Bank with a target price of 1,150, Tech Mahindra (TP: 1,300), Maruti Suzuki India (TP: 10,600), State Bank of India or SBI (TP: 740).

It also has Buy tags on Dalmia Bharat (TP: 2,070), Federal Bank (TP: 155), Varun Beverages (TP: 1,400), Ashok Leyland (TP: 175), Infosys (TP: 1,900), PNC infra (TP: 340), APL Apollo Tubes (TP: 1,240), HealthCare Global Enterprises (TP: 330).

Praj Industries (TP: 550), CCL Products (India) (TP: 600), Polycab India (TP: 3,080), and Bajaj finance (TP: 8,600) are also part of key stock recommendations.

“If the market sails through the next 6-9 months smoothly, we may see the next triggers for the market and money would flow to EMs, thereby increasing the overall market multiple," Axis Securities added.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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