2 Stocks To Buy Next Week For 40% Upside Gain As Recommended By Yes Securities

The shares of Cera Sanitaryware and Oil India have drawn attention from the broking company Yes Securities. The broking added that, while keeping the target price at Rs 8,809, it has raised the target rating from REDUCE TO NEUTRAL in light of the recent correction in Cera Sanitaryware's stock price. On the other hand, Yes Securities has assigned a buy recommendation to Oil India with a target price of Rs 833, signifying a possible 41% rise compared to the current market price of Rs 591.

Cera Sanitaryware Share Price Target

"Real-estate industry has witnessed strong launches and new constructions which should ideally lead to healthy demand for CERA's products viz Sanitaryware and Faucets. Hence, we reckon CERA's performance to improve from H2FY25E. Incrementally, we believe that growth should accelerate over FY26E-FY27E owing to strong tailwinds of real-estate industry. We have maintained our Revenue/EBITDA/PAT growth estimate of 9%/10%/8% respectively over FY24- FY26E. With healthy topline growth and focus on premiumization, we believe CERA will deliver operating margins of 16%/16.5% for FY25E/FY26E, respectively," said Yes Securities in a note.

"Notably, CERA has announced a buy-back of Rs1.3Bn (cash + current investment as on March'24 was Rs8.14Bn) at a price of Rs12,000/share. At CMP, CERA trades at P/E(x) of 37.5x on FY26E EPS of Rs220 (on FY27E EPS of Rs244, stock trades at P/E(x) of 33.8x). We continue to value the company at P/E(x) of 40x on FY26E EPS, maintaining our target price of Rs8,809. Given the recent correction in stock prices, we upgrade our rating from REDUCE TO NEUTRAL," the brokerage firm further added.

Oil India Share Price Target

"Oil India Limited (OIL) remains a key player as a leading integrated company across the energy value chain in India. The company is on track to meet its ambitious target of 4mmt of oil and 5bcm of gas production by FY26, backed by accelerated drilling activities in its rich Baghjan field, which will see the number of wells increase from 61 to ~80 in FY25 and 100 by FY27. The company is positioned to capitalize on favorable pricing with crude expected to average ~USD70/bbl & natural gas ~USD6.75- 7/mmbtu for FY26-27 supported by global demand-supply balance and suitable Indian government policies," the brokerage said.

Commenting on the share price target of Oil India, Yes Securities said, "The ongoing Numaligarh Refinery (NRL) expansion is set to triple its capacity to 9mtpa by Dec'25. Infrastructure projects like the Indradhanush Gas Grid (IGGL) will connect remote gas fields to key markets enhancing accessibility across India's northeastern states, unlocking opportunities for increased domestic gas sales and reducing reliance on gas imports. We build-in NRL's GRMs at ~USD14- 14.5/bbl through FY26-27, the company's expanding downstream presence will offer higher profitability compared to its upstream operations, allowing for enhanced shareholder value. We maintain a BUY rating on the stock with a TP of Rs 833/shr."

On the valuation of Oil India, the research analysts of Yes Securities said, "We maintain a BUY rating on Oil India, with a TP of Rs 833/sh and it remains our top pick in the space. Our TP of Rs 833/sh comprises a) Rs 525/sh for the standalone domestic business, valued on 6x EV/EBITDA FY27e, b) Rs 254/sh for NRL on EV/EBITDA of 8x FY26e, c) Rs 54/sh for investment in listed equities, valued at 30% hold-co discount to market price."