📈 Stocks To Buy: 20 January 2024 📊
The stock market has been experiencing a bearish trend in recent days, but yesterday saw a significant surge. According to experts, investors have a great opportunity to make money by investing in the shares of two government companies related to the financial sector.
Global brokerage house CLSA has recommended investing in the shares of PFC and REC. Both companies are involved in the financing of the power sector. In the last quarter, the shares of both government companies have increased by 40-50%. Over the past year, investors in PFC and REC have received a return of 250%.
As of Friday, 19 January 2024, PFC shares were trading at ₹399.70, showing a growth of 1.78%. REC shares were trading at ₹434.30, up by 2.36%. CLSA has raised the target price of PFC shares from ₹360 to ₹490, indicating a potential increase of 36%. On 17 January 2024, PFC shares closed at ₹392. Experts have raised the target price of PFC stock from 0.90X to 1.4X. In the past year, PFC stock has provided a return of 220% to its investors.
Similarly, CLSA has recommended buying REC shares. They have raised the target price of REC shares from ₹340 to ₹510, indicating a possible increase of 50%. On 17 January 2024, REC shares closed at ₹426. Experts have raised the target multiple of REC from 1.1X to 1.5X. In the past year, REC shares have provided a return of 250% to its investors.
Recently, Vedanta acquired struggling Meenakshi Energy, and REC received ₹1,440 crores for this acquisition. REC is the lender for most of the projects sold by the Indian government.
Both these government companies have a strong capital adequacy ratio. They have a 100% government guarantee on their loans. The ROE profile of both companies is strong, with PFC and REC trading at a 30-50% higher premium compared to SBI. In the financial year 2024-25, SBI is estimated to have a PB of 1X.
However, SBI’s ROE is relatively lower compared to PFC and REC, which stand at 20%. SBI has an ROE of 14%. The loan books of PFC and REC are expected to increase at an average rate of 15.5% over the next two years.
Investors can seize this opportunity and consider investing in PFC and REC shares to potentially gain significant returns.
So, don’t miss out on this chance to make money in the stock market! 💰📈
Disclaimer: This is News Coverage with Opinions of Experts and Should Not Be Taken as Direct Market Buying Tip. Market is always subject to risk. We recommend taking our content as research before investing.
