Highlights
- Avinash Gorakshakar recommends Varun Beverages, Indian Hotels, and Yatharth Hospital as top picks with strong growth potential.
- Consumption, hospitality, and healthcare are key themes driving India’s equity market opportunities.
- Target prices: Varun Beverages Rs 525-530, Indian Hotels Rs 730-735, Yatharth Hospital Rs 740-750.
India’s equity markets continue to throw up selective opportunities, with experts highlighting consumption, hospitality, and healthcare as key themes for investors. In an exclusive chat with ET Now Swadesh, market expert Avinash Gorakshakar has outlined three “Dhurandhar” stock picks, which are led by Varun Beverages, citing strong growth potential and attractive valuations.
Consumption theme in focus: Why does Varun Beverages stand out?
A key franchise bottler of Pepsi products, the company faced some setbacks last year due to a prolonged winter and unseasonal rains, which impacted demand during the peak summer season. However, the company’s outlook for the current year appears quite robust.
“This time, the heat has picked up, and with peak summer months still ahead, we expect strong volume growth,” he noted.
Strong financials and growth visibility
The company has reported robust financial performance in the previous year, with revenues exceeding Rs 21,000 crore and net profit of around Rs 362 crore. It is wide geographical presence and strong consumer demand further support its growth trajectory.
“Given its strong distribution network and consumption trends, we expect good volume growth this year,” he added.
Despite strong fundamentals, the stock has fallen significantly from it’s previous highs.
He said, “The stock had gone up to Rs 800–Rs 900 levels but is now available around Rs 400, making valuations quite attractive.”
He suggested a target share price of Rs 525 – Rs530 over a 12–15 month horizon, indicating meaningful upside potential.
He said, “Hotels and hospitality are seeing strong traction. Indian Hotels, being the largest chain in India, is well positioned.”
The company currently has around 57,000 rooms, with plans to add another 12,000 rooms over the next 12–18 months.
“With profits of around Rs 2,000 crore last year, we expect this to rise to Rs 2,200–Rs 2,300 crore this year,” he added, setting a target of Rs 730– Rs 735.
In the healthcare space, Yatharth Hospital & Trauma Care Services Limited emerged as a strong contender.
“Fundamentally, this stock has strong value,” the expert said.
He noted the company’s 2,300-bed capacity and presence in key specialities like oncology and orthopaedics.
The company has delivered strong financial performance, with Rs 860 crore revenue and around Rs 130 crore profit in the first nine months.
“We expect profits to reach at least Rs 165 crore this year, with expansion plans adding 3,000 beds over the next few years,” he said.
A target price of Rs 740–Rs 750 was suggested for a 12–15 month period.
“At this stage, investors should add companies with strong business longevity. Risk is relatively lower at current levels in these stocks,” he said.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
