Buy This Mid Cap Stock, Trading Near 52-Week Low, For 23% Return, 9.75 Dividend

Axis Securities has assigned buy call to ICICI Securities Ltd with a target price of Rs 625 apiece and a potential return of 23%. The board of directors of ICICI Securities has also announced a dividend of 9.75 per equity share on October 20, 2022. Buy the stock to receive double digit return and decent dividend of Rs 9.75 dividend.

According to the company's BSE filing, "The Board of Directors of the Company, at its Meeting held today i.e. October 20, 2022, inter-alia, approved the payment of interim dividend of Rs. 9.75 (Rupees Nine and Seventy Five Paise only) per equity share of face value of Rs. 5/- each to the shareholders of the Company whose names shall appear in the Company''s Register of Members as at the close of business hours on the record date i.e. November 1, 2022 as well as to those beneficial holders as registered in the records of Depositories as at the close of business hours on the record date."

Check key takeaways below:

1. ICICI Securities Ltd Stock Outlook

The current market price of the stock is Rs 509 apiece with a 52-week high at Rs 838 apiece and 52-week low at Rs 408 apiece, respectively. The company has a market capitalisation of Rs 16,457.42 crore.

2. ICICI Securities Financial Performance

According to Axis Securities, "ICICI Securities' (ISEC) Q2FY23 performance was marginally ahead of our estimates, driven by better-than-expected broking income. The broking industry witnessed sustained growth momentum in derivative volumes (+25% QoQ), though cash volumes remained flat QoQ (the silver lining being the halt in the sequential de-growth witnessed for 5 consecutive quarters). ISEC registered flat growth in broking and allied revenues, highlighting the company's efforts to reduce the share of cyclical components. However, core broking revenues (retail + insti.) The company's revenue stood at Rs 858 Cr (flat YoY, +8% QoQ), marginally ahead of our expectations of Rs 821 Cr."

3. ICICI Securities Return

The stock has given a return of 55% in the last 3-years and declined 32% in the last 1 year. It has surged 9% in the last 3-months.

4. Valuation

According to Axis Securities, "With operating leverage kicking-in we expect traction on earnings to improve and hence we revise our earnings estimates upwards by 2-9% over FY23-25E. As valuations are inexpensive (11x FY24E EPS vs longterm avg. P/E of ~15x), we continue to maintain our BUY recommendation on the stock with a revised target price of Rs 625/share (14x FY24E EPS), implying an upside of 23% from the CMP."

About ICICI Securities

ICICI Securities Ltd is a technology-based firm offering a wide range of financial services including investment banking, institutional broking, retail broking, private wealth management, and financial product distribution.

Disclaimer

The above stock has been picked from the brokerage report of Axis Securities. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.