ICICI Bank, SBI, Ashok Leyland, Praj Industries And More - Top Stock Picks For February: Axis Securities

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Axis Securities Report.Here are our top picks for February 2023:ICICI Bank Ltd. - Outperformance ContinuesThe bank has been outperforming its peers and has been firing on all cylinders. ICICI Bank has ticked most boxes on growth, margins, and asset quality. Higher loan growth, improving operating profits, and a strong provision buffer coupled with a strong deposit franchise will help the bank achieve return on average equity/return on average asset expansion over FY23-25E. On the valuation front, we believe the bank continues to be on a comfortable footing. Key risks: 1. Deterioration in the retail asset quality, 2. slowdown in credit growth momentum..State Bank of India - Ripe For Re-RatingAmong public sector banks, SBI remains the best play on the gradual recovery of the Indian economy on account of its healthy provision coverage ratio, robust capitalisation, strong liability franchise, and improved asset quality outlook. We believe normalization in credit costs and improved growth outlook should lead to double-digit return on equities of ~16.5% over FY23-25E. Key risks: 1. a slower-than-expected recovery cycle.Ashok Leyland Ltd. - Market Share Gain, Profitability To Sustain Growth Ashok Leyland's broad strategy is focusing not only on the medium and heavy commercial vehicle segment but also expanding its market share/revenue in light commercial vehicle, buses, tractor trailer, electric vehicles, defence equipment/vehicles, exports, spares and aftermarket; thereby hedging its dependence on the cyclical truck business. Ashok Leyland is targeting market share gains in its LCV and ICV business with the launch of superior products and expected foray into the electric LCV segment by June-23. With improved profitability (raw material softening), market share gains (increased demand), new and superior product offerings in the pipeline to cater to growing IC and EV demand; and a focus on better services, Ashok Leyland remains well-positioned to benefit from the CV upcycle. Key risks: 1. Higher Interest rate, 2. Competitive pressures, and 3. Higher discounting..Praj Industries Ltd. - Well Placed To Grow, Less Impact Of Global Geo-Political Volatility On BusinessPraj Industries is witnessing strong growth in its key segment bioenergy in domestic business, the overall demand-supply gap of Ethanol, increased interest in grain-based distilleries and decarbonisation impetus is auguring well for Praj along with development in other key verticals such as CPS, ZLD and high purity gaining traction. Praj is a key beneficiary of multiple tailwinds provided by the bio-economic revolution, giving strong growth and revenue visibility for the next three-five years. Key risks: 1. Raw material cost pressure in steel; 2. Volatile raw material weighing on operating profitability in the near term; 3. Russia-Ukraine crisis to dampen business in the Euro region..Click on the attachment for full list of Axis Securities' Top Stock Picks for February 2023:.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

ICICI Bank, SBI, Ashok Leyland, Praj Industries And More - Top Stock Picks For February: Axis Securities

Going forward in 2023, we believe the Indian equity market will continue to trade at a higher premium to emerging market peers.

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