6 SALMAN stocks delivered up to 37% return, beating Sensex in 2022

Six SALMAN stocks delivered double digit returns in an otherwise tepid year for equities.  SALMAN is an abbreviation used for six largecap stocks namely State Bank of India (SBI ), Axis Bank, Larsen & Toubro, Maruti Suzuki, Adani Ports and NTPC. It is similar to HRITHIK stocks (the acronym for seven bluechips — HDFC twins, Reliance Industries, ICICI Bank, Tata Consultancy Services, Infosys and Kotak Mahindra Bank) and more popular FAANG stocks used in the US.

Data showed the six Salman stocks delivered at least 10 per cent return in 2022. Axis Bank has been the biggest gainer in the pack, rising 36.87 per cent to Rs 928.75 from Rs 678.55 level as of December 31, 2021.

State-run NTPC has gained 33 per cent to Rs 165.55 compared with Rs 124.40 at December 2021 end. SBI has risen 30 per cent so far this calendar, to Rs 596.75 from Rs 460.45 apiece. Maruti Suzuki, Adani Ports and Larsen & Toubro have gained 10-11 per cent each this calendar.

Among these stocks, SBI, L&T, Maruti Suzuki and Axis Bank are among Motilal Oswal Securities’ top 2023 picks.

Motilal Oswal said SBI is one of the few large-cap stocks available at reasonable valuation with high growth, led by strong Retail loans and pick-up in corporate segment.

“Asset quality remains strong, with a continuous improvement, while the restructured book remains under control at 0.9 per cent. High mix of floating loans, which will benefit from loan re-pricing, will continue to support the NII and overall earnings,” it said.

In the case of Axis Bank, the private lender is seeing witnessing strong growth in retail and mid-corporate segment, which along with MSME, would remain the key growth drivers.

“It expects cost-to-assets ratio to moderate at 2 per cent by the end of FY25, which coupled with a benign credit cost would aid RoE expansion. We estimate Axis Bank to deliver FY24E RoA/RoE of 1.8 per cent/18.1 per cent,” Motilal Oswal said.

HDFC Securities said L&T is is well poised to be the key beneficiary of capex upcycle driven by investments in both public and private sectors. The domestic brokerage has picked the stocks among its top 10 picks.

“L&T has refinanced the debt undertaken for the development of Hyderabad Metro leading to a favourable interest rate outgo and is planning monetisation of the real estate space of the metro network and seeking government grants to be able to lower the debt burden, which is currently at Rs 13,000 crore. L&T is targeting to reduce debt by Rs 5,000 crore over next 2-3 years led by receipt of interest free loan of Rs 3,000 crore from Telangana government and monetisation of ToD rights of Rs 2,000-2,500 crore,” it said.

Maruti Suzuki is among Religare Broking’s 2023 pick. The brokerage said the carmaker would be the biggest beneficiary from the demand in the passenger vehicle industry given its leadership position, strong presence in the entry level segment and wide distribution network.

“In the next 2 years, Maruti Suzuki intends to launch products in the UV segment, focus on premiumisation and revamp its existing product portfolio Maruti is a debt free company with healthy financials, consistent dividend payout and generates strong free cash flow,” it said while suggesting a target of Rs 9,000-9,650 on the stock.

NTPC has an average target price of Rs 195.33, as per publicly data available with Trendlyne, which suggests an 18 per cent upside potential.

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