In this article, we look at two stocks, both from the Financial Services and Metals & Mining sector, recommended by the Trade Brains Portal to buy for an upside potential of more than 25%. We also analyzed the market’s performance yesterday to understand what may lie ahead for the stock indices in the coming days.
REC Ltd
- CMP: ₹ 423
- Target: ₹ 520
- Upside: 23%
- Time frame: 12 Months
Why it’s recommended
Incorporated in 1969, Rural Electrification Corporation Limited (REC Ltd.), one of the top “Maharatna” companies,, is registered as an Infrastructure Financing Company (IFC), Public Financial Institution (PFI), and Non-Banking Finance Company (NBFC). REC finances the entire power-infrastructure sector, which includes renewable energy, transmission, distribution, and generation. In addition, REC also funds cutting-edge technologies like electric cars, battery storage, pump storage, green hydrogen, and green ammonia projects.
REC has also diversified into the non-power infrastructure sector, which includes ports, roads and expressways, metro rail, airports, IT communication, and electro-mechanical (E&M) projects associated with various other industries, such as steel and refineries. The company’s disbursements increased 18% year over year to Rs 1,91,185 crore in FY25 from Rs 1,61,462 crore in FY24. In FY25, the business had its highest-ever loan book of Rs 5.67 lakh crore, up 11% year over year, and its highest-ever earnings of Rs 15,713 crore, up 12% year over year. At Rs 19,878 crore, net interest income climbed by 27%, and asset quality is significantly increasing. The total revenue increased 19% year over year to Rs 55,980 crore. The company paid out a total of Rs 18 in dividends per share, a 180% increase, while its earnings per share for FY25 were Rs 59.55.
In FY25, the company’s NIM climbed 6 basis points YoY to 3.63%, and in FY26, it will range between 3.5% to 3.75%. The company expects to reach Rs 10 lakh crore at a 12% CAGR by FY30 and expects to disburse 2-2.1 lakh crore in FY26. Prepayments are anticipated to stay at about Rs 1 lakh crore per year, with the transmission and smart metering project providing an opportunity of Rs 1.1 lakh crore over the next two to three years. The company, which has a current book value of Rs 58,000 crore, plans to invest Rs 3 lakh crore in renewable energy by 2030. The Revolving Bill Payment Facility sanctions, which are valid for five years, are intended to disburse between Rs 80,000 and Rs 90,000 crore in FY26. EPC contracts are finished, and payments will go up in FY26.
Risk Factors
Clients with unstable financial standing, such as state power firms, pose a threat to the company. With 36% of the overall loan book as of December 31, 2024, the company is also exposed to client concentration risk. The business is also subject to changes in customer behavior, regulations, and technology.
Hindustan Zinc Ltd
- CMP: ₹ 534
- Target: ₹ 630
- Upside: 18%
- Time frame: 12 Months
Why it’s recommended
Established in 1966, the largest integrated zinc producer in the world and one of the top five producers of silver worldwide is Hindustan Zinc Ltd., a division of the Vedanta group. The company has a 77% market share in India’s primary zinc sector and supplies to more than 40 nations. With an average zinc-lead grade of 6.5% and a total R&R (reserves and resources) base of 453.2 million tonnes, Hindustan Zinc has been in mining for more than 25 years. A low-carbon ‘green’ zinc brand, EcoZen, was also introduced by the company.
Hindustan Zinc Ltd. produced 1,095 kt of mined metal and 1,052 kt of refined metal in FY25, which was the company’s highest production to date. With a 77% market share, it maintained its leading position and posted its highest-ever domestic zinc sales of 603 kt. For the first time, its total metal resources and reserves reached 29.6 Mt, with its metal reserves surpassing 13.1 Mt (net of 1.2 Mt production). With the second-highest sales ever recorded at Rs 34,083 crore, up 18% YoY from Rs 28,932 crore in FY24, the company announced strong financial performance for FY25. Its EBITDA grew 28% YoY to Rs 17,465 crore, with an industry-leading EBITDA margin of 51%. The company’s Profit After Tax (PAT) reached Rs 10,353 crore in FY25, growing by 33% from Rs 7,759 crore in FY24. It also generated a strong free cash flow from operations (pre-capex) of Rs 13,784 crore and marked its highest ever return on capital employed of 58%.
With a clear CAPEX roadmap, Hindustan Zinc is confident that it will continue to perform well in the upcoming year. Mine metal output is expected to reach 1.125 million tons per year (MTPA), while refined metal production will reach 1.1 MT. Zinc output is estimated to be between $1,025 and $1,050 per ton, while refined silver production is between 700 and 710 tons. It is anticipated that the total capital expenditure for the growth capital projects that have been approved thus far would fall between $225 million and $250 million. The company anticipates commissioning the Roaster plant in Q1 FY26, currently processing 160,000 tons of zinc ore annually.
Risk Factors
Since it meets 70% of India’s demand for zinc manufacturing, the company is subject to fluctuations in the demand for galvanized steel. Being a capital goods sector, it is heavily reliant on sectors like consumer durables, home appliances, batteries, infrastructure, construction, and automobiles. Additionally, metals like aluminum and other alloys pose a threat to zinc’s supply. Given that Rajasthan is where most of the company’s output is located, it may also be at risk from regional and regulatory concentration.
Market Recap June 10th, 2025
Today, Nifty 50 opened above the 20-day EMA in the daily time frame at 25,196, peaking at 25,199.30 and closing at 25,104.25, and ended on a flattish note. Similarly, BSE Sensex mirrored the trend, opening at 82,643.73, and closing at 82,391.72, declining by -53.49 points, or -0.06%. Both the indices traded above all four 20/50/100/200 EMAs, with Nifty 50 RSI at 61.46 and BSE Sensex RSI at 59.87 (well below the overbought zone of 70). This was mainly due to the profit bookings amongst the investors as the markets were on an optimistic trend over the past few days following the RBI rate cut.
On the sectoral front, the Nifty IT index was the top gainer, closing at 38,299.95, up by 630.75 points, or 1.67%. IT stocks, including Oracle Financial Services Software Ltd., Persistent Systems Ltd, Mphasis Ltd, LTI Mindtree, and Coforge, were the major gainers, surging up to 3%. The Nifty Media index followed the lead with gains of 18.65 points, or 1.09%, closing at 1,731.65. Network18, Zee Entertainment, Hathway Cables and Nazara Technologies took the lead with gains of up to 5%.
The Nifty Realty index was the major laggard, losing -11.85 points, or 1.14%, closing at 1,026.30. Macrotech Developers Ltd and Prestige Estates lost more than 2%, dragging the index down. The Nifty PSU Bank Index was also in the red, closing at 7,170.85, down by -37.60 points, or -0.52%.
With the US-China trade talks entering their second day and hopes of policy easing among the world’s top countries, Asian markets saw mixed results on Tuesday. The South Korean Kospi index maintained its upward trend, closing at 2,871.85, up 0.56%, or 16.08 points, while the Hong Kong Hang Seng index remained flat, down -0.08%, or -18.56 points, among the Asia-Pacific markets. Japan’s Nikkei 225 rose 0.32%, or 122.94 points, to close at 38,211.51, while the Shanghai index fell -0.44%, or 14.95 points, to close at 3,384.82.
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