Listed below are the 3 stocks on which renowned brokerage firm, Geojit Financial Services has given a buy rating with potential upsides over 20 percent.
PG Electroplast Ltd
PG Electroplast Ltd (PGEL) is a key electronic manufacturing services (EMS) provider in India, known for its diverse product portfolio and nationwide presence. It is the second-largest RAC player Original Design Manufacturer (ODM) for washing machines.
Geojit has given the stock an “Accumulate” rating with a target price of Rs 1,084 per share, indicating an upside potential of 21 percent.
Rationale
The Indian Room Air Conditioner (RAC) industry is expected to grow at a 15 percent CAGR between FY24-FY27E, driven by rising consumer demand and low market penetration.
PG Electroplast’s revenue is expected to grow at a 27 percent CAGR over FY25E-FY27E. EBITDA margins are set to improve from 9.5 percent in FY24 to 10.3 percent in FY27, supported by backward integration and rising demand. ROE may decline in FY25 due to a Qualified Institutional Placement (QIP) but is expected to recover to 15 percent by FY27.
The company’s strong balance sheet and plans to enter the EV and compressor manufacturing segments are likely to sustain its premium valuation. Geojit has initiated coverage based on a P/E of 56x on FY27E EPS.
Wonderla Holidays Ltd
Wonderla Holidays Ltd. (WHL) is a dominant player in the amusement park market in India, with four well-established parks and plans for expansion.
Geojit has given the stock a Buy rating with a target price of Rs 799 per share, indicating an upside potential of 21 percent.
Rationale
The company’s revenue is expected to rise 16 percent in FY26 and 23 percent in FY27, supported by increasing footfall and higher Average Revenue Per User. The ARPU has grown at an 11 percent CAGR from FY13 to FY24 and is projected to reach Rs 1,580 by FY27.
While the new parks might negatively affect the margins initially owing to initial setup and running costs, profitability would improve when there is greater footfall. The company’s debt-free status ensures financial stability and allows for strategic growth investments. Also, WHL is exploring an asset-light expansion model in North India.
Based on these factors, Geojit has valued the company at 18.5x FY27E EV/EBITDA, in line with its long-term average.
Suzlon Energy Ltd
Suzlon Energy, an integrated manufacturer of wind turbines and O&M service provider, has an installed capacity of 20.9GW. With the third repeat order for 204.75 MW, its total orders from Jindal Renewables stand at 907.20 MW, making Jindal its single largest C&I customer
Geojit has given the stock a Buy rating with a target price of Rs 71 per share, indicating an upside potential of 23 percent.
Rationale
EBIT margins expanded by 119 bps in Q3FY25, primarily driven by a significant 909 bps increase in WTG (Wind Turbine Generator) margins. The forging and foundry businesses also saw a YoY improvement of 704 bps, reflecting stronger profitability. However, OMS (Operations & Maintenance Services) margins declined by 533 bps, impacted by the full consolidation of Renom, a subsidiary.
Suzlon cut its WTG installation target from the earlier 4.5GW – 5GW range to 3.5GW – 4GW. In order to accommodate growing future demand, the company has increased its capacity over 4.5GW, with upgraded Pondicherry and nacelle facilities. They have also installed new blade production lines at Madhya Pradesh and Rajasthan.
As of December 2024, Suzlon reported a net worth of Rs 4,914 crore and a net cash position of Rs 1,107 crore. Geojit anticipates a 70 bps expansion in margins, driven by higher EBITDA contributions and improved profitability in the WTG segment. Suzlon’s PAT is projected to grow at a 30 percent CAGR over FY25-27E and has received a valuation of 40x PE on FY27 EPS.
Written by Shwetha Sairam
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