Analysts predict Tata Motors, Varun Beverages, Kirloskar returns

Analysts have identified three stocks that could offer investors high returns. These are Tata Motors, Varun Beverages, and Kirloskar Oil Engines. Predictions suggest returns could range from 27% to 72%. Factors such as strong valuations, margin expansions, and growth opportunities are driving this optimism. However, there are risks, including a potential slowdown in demand and increasing competition. Tata Motors is one of the highlighted stocks. Analysts from HSBC have a price target of Rs 840, up from the current market price of Rs 661, indicating a potential upside of 27%. The recent decrease in valuation is seen as a good buying opportunity. The company’s subsidiary, Jaguar Land Rover, is expected to meet its fourth-quarter guidance, which could help boost the stock. Additionally, reductions in discounts and improvements in small commercial vehicle sales may support margin expansion. Varun Beverages is another stock to watch. JM Financial has set a price target of Rs 675, with the stock currently priced at Rs 507, suggesting a 33% upside. The recent drop in stock price is viewed as overblown. The company’s strong execution, large market opportunities, and being debt-free are expected to enhance earnings growth. Analysts note that its current price-to-earnings ratio is still attractive compared to competitors in the FMCG sector. Finally, Kirloskar Oil Engines could see a significant upside of 72%, according to Motilal Oswal’s price target of Rs 1,150. The stock is currently at Rs 668. Analysts believe the current price reflects excessive pessimism about the company’s growth and margins. However, concerns exist over a potential demand slowdown, rising competition, and increased costs in its business-to-consumer segment, alongside risks related to further financial support for its group firm, Arka Fincap.