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Below is the Views On Top 4 mid-caps to look in 2020 by Mr. Amarjeet Maurya, AVP-Mid- Caps, Angel Broking Ltd.
The Indian equity market has witnessed a robust growth over the past couple of months.As a matter of fact, it is breaching all-time highsmore than once every month since November, 2019. However, this growth is largely drivenby large caps. The small-cap and mid-cap segment was under duress last year. This year, this segment is expected to give good returns and will drive the next wave of market growth.
So, if you wish to enhance your investment portfolio with worthy mid-cap stocks, here are some of the most-promising ones:
Hawkins Cookers (HCL):
HCL is forecasted to report a healthy top-line with CAGR of 13%. It will grow to Rs. 954 crores over FY2019-22E. This growth will be primarily driven by government initiatives, new product launches, and extensive distribution network. In terms of bottom line (reported PAT), the estimate comes around 24% CAGR reaching Rs. 102 crores because of operating margin improvement and strong revenue performance.This improvement will be driven by correction in raw material prices.Thus, we maintain BUY on the stock.
Kajaria Ceramics (KCL):
During third quarter of FY20, Kajaria Ceramics’volume growth has been subdued because of the market slowdown, whose effect can be seen on the entire real estate sector.Still, management expects that there will be improvement in volume off-take in the coming fiscal. This will be because of a slew of measures taken by the government to stimulate market demand, especially vis-à-vis the housing market. It has also infused Rs. 25,000 crores for housing projects andtaken positive steps on the liquidity front. So, Kajaria Ceramics is expected to deliver a CAGR of 16% in bottom line over FY2019-22E. There is a BUY recommendation on KCL.
KEI Industries (KEI):
KEI Industries is expected to report a CAGR of 17% in terms of net revenue during FY2019-22E. Its growth will be driven by a number of factors. Primarily, higher-order book execution in the EPC segment. Secondly, growth in its EHV business. And lastly, because of higher exports. In terms of bottom line, the company might extend a CAGR of 26% because of growth in overall volume, making the figure reach Rs. 363 crores over FY2019-22E. We maintain a BUY recommendation on KEI as well.
Safari Industries (SIL):
Safari Industries has catered to customers from all segment by diversifying its product portfolio while also strengthening its distribution network. The company’s top line is expected to reach Rs. 1,011 crores over FY2019-22E with a 21% CAGR. Simultaneously, its bottom line will grow at 30% throughout the same period because of improvements in operating margin. A BUY recommendation is maintain on SIL.
These were the top 4 mid-cap stocks that you can consider in 2020. The entire segment has a lot of upside potential and these stocks are expected to deliver a good yield.
Above views are of the author and not of the website kindly read disclaimer