Investments in “Bluechip” stocks are considered to be safe investments since they are well-established and have performed well in the past. Such stocks also have a strong and consistent dividend payout history.
Listed below is one such Bluechip stock that one could add to their watchlist for a potential upside of more than 30 percent:
Hindustan Unilever Limited
With a market capitalization of Rs 5.25 lakh crores, the stocks of Hindustan Unilever Limited (HUL) started their trading session on Tuesday at Rs 2,234.35 and currently trades at Rs 2,235.70, gaining approximately 0.40 percent as compared to the previous closing levels of Rs 2,226.95 apiece.
Recently, the large-cap FMCG company announced its results for the quarter and financial year ending March 2024. On a sequential basis, the company’s basic business indicators, viz, its operating revenues as well as after-tax profits, reported movements in opposing directions.
The former, on one end, reduced from Rs 15,567 crores during Q3FY24 to Rs 15,210 crores during Q4FY24, and the latter, keeping the timeframe the same, rose marginally from Rs 2,508 crores to Rs 2,561 crores.
In addition, the bank, historically, has kept the return ratios during FY23-24, viz, the return on equity (RoE) as well as the return on capital employed (RoCE), intact with the former reported at a decent 20.06 percent and the latter at 21.72 percent.
Having a positive outlook for the bank’s future operations, Motilal Oswal, one of the well-known Domestic Brokerages, gave a ‘Buy’ recommendation on the stocks of Hindustan Unilever Limited with a target price of Rs 2,900 indicating a potential upside of approximately 30 percent.
The rationale for providing such a recommendation pertains to the FMCG company’s financial performance in 4QFY24 being in with the estimates, the ‘Home Care” segment witnessing growth, and margins beating market expectations.
Moreover, the Brokerage believes that the volume growth in Hindustan Unilever has bottomed out and expects a gradual recovery in volumes by FY25. HUL’s presence across price segments and wide product baskets should help the company achieve a steady growth recovery.
Hindustan Unilever Limited is a consumer goods company offering diverse products with over 50 brands from 16 distinct categories, including shampoos, skincare, soaps, toothpaste, etc. The company’s product portfolio also contains household brands such as Lifebuoy, Pepsodent, Closeup, Dove, Clinic Plus, Surf Excel, Rin, and many more.
Written by Amit Madnani
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
