Today, we recommend two stocks, one from the Sugar sector and another from the Microfinance sector, by the Trade Brains Portal, to buy for an upside potential of up to 24%. We also analyzed the market’s performance on Monday to understand what may lie ahead for the stock indices in the coming days.
1. Dalmia Bharat Sugar & Industries Ltd
- Current price: ₹ 418
- Target price: ₹ 520
- Upside: 24%
- Time frame: 12 Months
Why it’s recommended
Dalmia Bharat Sugar & Industries Ltd. entered the sugar business in the mid-1990s, establishing its first unit in Ramgarh, Uttar Pradesh, in 1994. It is now one of the youngest yet among the largest sugar companies in India, engaged in the production of sugar, industrial alcohol, and refractory products, along with power generation. With a total cane crushing capacity of 43,200 TCD, the company stands among the country’s leading sugar producers. Today, it operates as a fully integrated player with 126 MW of cogeneration capacity and a distillery capacity of 850 KLPD, equipped with incineration boilers.
In FY25, the company posted a revenue of Rs 3,746 crore from operations, marking a strong YoY growth of 29%. EBITDA came in at Rs 544 crore, and PAT at Rs 387 crore. It achieved record domestic sugar sales of 5.9 LMT (Lakh Metric Tons), which helped reduce its year-end sugar inventory to 3.8 LMT, down from 4.3 LMT in FY24. The company also reported an all-time high average sales realization of Rs 38/kg. Its Grain Distillery delivered 6.2 crore liters in FY25, reflecting a 72% YoY increase, primarily due to capacity expansion. Domestic sales rose by 22%, from 1.1 Lakh MT in Q3 FY25 to 1.4 Lakh MT in Q4 FY25, while export sales doubled to 0.1 Lakh MT over the same period.
India is the world’s largest producer of sugar, with Uttar Pradesh leading sugarcane production, followed by Maharashtra and Karnataka. The country is also the third-largest exporter of sugar globally. According to the United States Department of Agriculture (USDA), India’s sugar production is projected to reach 35 million metric tons raw value (MMT-RV) for the 2025-26 marketing year, representing a 26% increase over the revised estimate of 28 million tons for the current year.
Risk Factor
The sugar industry is cyclical and highly dependent on favorable weather, agricultural yields, and cane availability. Unpredictable monsoons or lower yields could adversely affect Dalmia’s performance. Additionally, the sector is regulated under the Sugar (Control) Order, which mandates stock limits, transportation norms, and controlled sales, along with the government-fixed Fair and Remunerative Price (FRP) for sugarcane. Non-compliance with these regulations may pose operational risks for the company.
2. CreditAccess Grameen Ltd
- Current price: ₹ 1,197
- Target price: ₹ 1,420
- Upside: 19%
- Time frame: 12 Months
Why it’s recommended
CreditAccess Grameen was founded in 1999 as an NGO in Bengaluru, and in 2007, the microfinance operations were transferred into an NBFC. It offers collateral-free microloans to women from low-income households under the joint liability group model. Apart from the microloans, it is also increasing its portfolio by providing retail finance products to existing customers. As of FY25, the company is the largest MFI in India, which has 46.94 lakh borrowers and an AUM of Rs 25,948 crore. It has a presence in over 16 states, 423 districts, and 2,063 branches as of March 2025.
The company has achieved a healthy 18% CAGR growth in AUM since FY21. Its diversified borrowing profile allows for controlled borrowing costs, resulting in a Net Interest Margin (NIM) of 12.9% in FY25. The company has effectively managed its cost-to-income ratio, reducing it from 38.1% in FY21 to 30.7% in FY25. Despite a dip in profit from higher provisioning, pre-provisioning profit still shows strong growth of 10.3% YoY. Additionally, the company aims to enhance its retail finance segment, targeting an increase in the retail portfolio to 10%-15% of AUM by FY28.
The company stood at a reasonably good asset quality, with NNPA of 1.73%, due to conservative provisioning and strong risk management capabilities, even in adverse situations like over-leveraged borrowers, political movements, and disruption of operations in Karnataka because of the implementation of the microfinance bill. Management gave guidance on Gross Loan Portfolio (GLP) growth of 14-18% for FY26, with NIM expected to be stable at 12.6-12.8%.
Risk Factor
Credit Access’ Gross loan Portfolio is dominated by Karnataka with 31.1%, followed by Maharashtra with 21.5% and Tamil Nadu with 19%, as of Q4FY25. This poses a geographical concentration risk as the GLP of the NBFC is dominated by the top three states, with around 71.6%. Additionally, the Karnataka MFI ordinance and similar regulations in Tamil Nadu are likely to increase delinquencies for the company in these states, although the overall business is expected to normalize.
Market Recap 16th June, 2025
After beginning the day at 24,732.50, climbing to 24,967, and finishing at 24,946.50, the Nifty 50 concluded the day up 0.92%, or 227.90 points. With an upward trend, the BSE Sensex opened at 81,034.45, and it closed at 87,796.15, up 677.55 points, or 0.84%. Both indices were trading above the three EMAs (50/100/200), with the Nifty 50 RSI at 55.70 and the BSE Sensex RSI at 54.04 (far below the overbought threshold of 70).
Both benchmark indices saw modest advances as a result of investors’ positive response to central banks throughout the world taking a more cautious approach to policy, especially in light of falling inflation. This was fueled by bullish signals from Asian markets and US futures, as well as the relaxation of India VIX dropped 1.84 percent to 14.8, demonstrating a decrease in investor anxiety and improving market sentiment.
The largest sectoral gainer was the IT index, which ended the day at 39,073.05, up 603.80 points, or 1.57%. Gains of up to 2 percent were reported by the biggest corporations, including Oracle Financial Services, Infosys Ltd., TCS, Coforge, and HCL Technologies Ltd.
The Nifty CPSE index gained 87.60 points, or 1.34%, to close the day at 6,617.10. With gains of up to 2%, ONGC, Powergrid Corporation, Oil India Ltd., and Cochin Shipyard Ltd. led the sector. Tata Motors was today’s biggest loser, falling 4% as its subsidiary JLR gave a pessimistic outlook for FY26.
Asian markets reacted favorably on Monday as “the world’s factory,” China, released its May retail sales and industrial output figures. Retail sales grew 6.4% year over year, but industrial output growth slowed to 5.8%. In the Asia-Pacific markets, the South Korean Kospi index continued its upward trajectory, climbing 1.8%, or 52.04 points, to close at 2,946.66.
While the Hong Kong Hang Seng index increased 0.7%, or 168.43 points, to conclude at 24,060.99. At 38,311.33, Japan’s Nikkei 225 closed up 477.08 points, or 1.26%. The Shanghai index gained 11.73 points, or 0.35%, to close the day at 3,388.73. The US Dow Jones Futures closed at 42,738, up 181 points, or 0.41%, as the Fed’s interest rate decision is still anticipated to be made on Wednesday. It is expected that the central bank would keep interest rates the same and take a wait-and-see approach to potential future borrowing cost reductions.
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