Stocks to buy for short term: Infosys, Maruti Suzuki , KRBL among Mirae Asset ’s top picks for December; check full list

As 2024 wraps up, Mirae Asset Capital Markets has unveiled its top ten stock picks for December, offering valuable information for investors looking to gear up for the upcoming year.

These stocks have been chosen for their ability to yield returns across various market sectors, with large-cap stocks anticipated to offer stable returns of around 3-4%, while small- and mid-cap stocks are estimated to provide greater growth potential of about 8%.

Below is an in-depth examination of each of Mirae Asset’s selected picks for December.

Stocks to buy for short term

Aadhar Housing Finance

Aadhar Housing Finance stands as the leading affordable housing finance company (HFC) in India, boasting an asset under management (AUM) of ₹217 billion and holding a ~2% share in the affordable housing sector. As of June 2024, the company’s AUM was 20% larger than that of its closest competitor, Aavas Financiers, and more than double the size of other rivals such as Home First Finance, Aptus Value Housing, and India Shelter Finance.

Bank of Baroda reported strong results for Q2 across various metrics. The profit after tax (PAT) increased noticeably by 18% quarter-on-quarter, driven by improved recovery of non-performing loans. While net interest margins (NIMs) remained stable at 3.27% (down 3 basis points QoQ) and credit costs were kept in check at 65 basis points, below the 1.0% target, these factors supported core profit before provisions (PPOP)/average assets (AA) at 1.5%, consistent with previous trends. Additionally, the bank showed significantly better business performance sequentially, with loan and deposit growth of 7% and 4%, respectively, on a quarter-on-quarter basis.

Home First Finance

Home First Finance continued its robust growth trajectory as anticipated, with AUM rising by 35% year-over-year in Q2FY25. Additionally, NIM grew by more than 10 basis points due to an increase in yield following a recent rise in PLR. The combination of strong income and controlled credit costs at 20 basis points resulted in a 5% sequential rise in PAT to ₹922 million. The management maintains its guidance of over 30% AUM growth and anticipates credit costs to be in the range of 20-30 basis points for FY25E.

Infosys

Infosys is concentrating on enhancing its initiatives in Generative AI and collaborating with clients to implement enterprise Generative AI platforms, serving as a foundation for a variety of use cases in this area. These Generative AI endeavors are now integrated into extensive programs, with the company progressing several AI projects from proof of concept to execution, particularly prioritizing customer support and sales effectiveness.

“Our analyst believes the company is well-equipped to achieve the top end of its growth guidance for FY25E, thanks to strong performance across multiple verticals, increased volumes, gaining market share in cost efficient deals, and a stable demand environment,” the report said.

KRBL holds a robust stance in both the export sector (making up 25% of FY24 revenue) and the local market. The company’s leading brand, ‘India Gate’ (approximately 58% of FY24 revenue), enjoys a premium of around 29% compared to its competitors. The domestic market is expected to be a long-term catalyst for basmati rice as Indian consumers increasingly prefer packaged food products due to their growing affluence.

“Our analyst expects KRBL to be one of the key beneficiaries of this consumption trend on account of its market leadership, wide distribution network and strong brand positioning,” said the report.

Lemon Tree is strategically positioned in the market to take advantage of the increasing demand in the upper midscale, mid-scale, and economy categories by offering a unique range of rooms. Looking ahead, the company aims to expand its room inventory in these categories by utilizing managed and franchised agreements, which are asset-light and necessitate lower investment while delivering a higher return on capital employed (ROCE).

The company is a leader in the global basmati rice market. It owns the ‘Daawat’ brand, which has a 30% market share in India and 20% in Europe, along with the ‘Royal’ brand, which commands a 50% market share in the US. The company intends to double its capacity in the US and extend its reach to the UK to capture a share of the GBP 1bn ( ₹110 bn) basmati rice and rice-based food sector. Currently, LT Foods holds approximately 54% of the US branded rice market.

Maruti Suzuki India

In the export segment, the company has begun to ship the Fronx to the Japanese market alongside the Jimny-5 Door, which it is already supplying to Latin America, the Middle East, and Africa, with a goal of reaching 750,000 annual sales by FY31. Fueled by robust demand in international markets, the expansion of its network, the introduction of new products, and geographic diversification will drive significant growth in export volumes in the upcoming years, with the company targeting sales of approximately 300,000 units in FY25.

TVS Motor

TVS Motor has strategically positioned itself to capitalize on the premiumization trend by enhancing its product offerings, introducing new products, expanding customer reach, and aggressively building its network for electric two-wheelers (with upcoming EV launches). In the future, a rebound in the export market along with increased traction in rural areas will contribute to sustained volume growth for the company. Additionally, the rural market has outperformed the urban market, posting a growth rate of 9% compared to 7% in the urban sector.

Suzlon Energy

Suzlon’s leadership is optimistic about increasing the commissioning rate in the second half of FY25, addressing previous disruptions and utilizing a strong order book outlook. The company is set to take advantage of new prospects in the renewable energy industry, supported by a solid financial standing and strategic plans.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.