Jefferies Initiates Coverage on 13 Stocks Including Adani Enterprises (ADANIENT) and HAL: Key Insights

<ul>
  <li>Jefferies has initiated coverage on 13 Indian stocks in 2024, expanding its total coverage to 188 stocks with a combined market cap of $3.4 trillion.</li>
  <li>Most of these newly covered stocks have significantly outperformed the benchmark index.</li>
  <li>Indian benchmark Nifty has jumped over 6 percent in 2024 YTD and over 2 percent in May, extending gains for the fourth straight month.</li>
</ul>
<p><strong>Jefferies expands coverage to 188 Indian stocks, highlighting significant market movers in 2024.</strong></p>

<h2><strong>Jefferies' New Coverage: A Closer Look at the 13 Stocks</strong></h2>
<p>Global brokerage house Jefferies has expanded its coverage to include 13 new Indian stocks in 2024, bringing its total coverage to 188 stocks. These stocks represent a combined market cap of $3.4 trillion, accounting for 70 percent of India's listed market. This strategic move comes as most of these newly covered stocks have significantly outperformed the benchmark index.</p>

<h3><strong>Indian Market Performance in 2024</strong></h3>
<p>The Indian benchmark Nifty has shown a robust performance in 2024, with a year-to-date (YTD) increase of over 6 percent. In May alone, the index rose by over 2 percent, marking the fourth consecutive month of gains. The market's positive trajectory is attributed to several factors, including certainty around the Modi-led BJP winning a third term in the upcoming general elections, positive foreign investor inflows, robust domestic buying, and improving macroeconomic conditions.</p>

<h2><strong>Key Stocks Under Jefferies' New Coverage</strong></h2>
<p>Jefferies has identified several key stocks in its new coverage, each with unique growth prospects and market potential:</p>

<h3><strong>360 One WAM</strong></h3>
<p>Jefferies has given a 'Buy' rating to 360 One WAM with a target price of ₹900, indicating a 9.4% upside. The firm is the largest Integrated Wealth Management (IWM) company focusing on Ultra High Net Worth Individuals (UHNI) and a leading asset manager in private markets. Jefferies expects a 25 percent CAGR in active assets under management (AUM) of the wealth business over FY24-27E.</p>

<h3><strong>Adani Enterprises</strong></h3>
<p>Adani Enterprises (AEL) has been rated 'Buy' with a target price of ₹3,800, reflecting a 12% upside. AEL is India's leading business incubator, with new ventures in Airport and Green Hydrogen sectors. Jefferies anticipates AEL's EBITDA to grow threefold over FY24-FY28, driven by strong industry tailwinds in new energy, sustainability, and infrastructure.</p>

<h3><strong>Bharti Hexacom</strong></h3>
<p>Bharti Hexacom is recommended as a 'Buy' with a target price of ₹1,080, offering a 6% upside. The company is expected to deliver a 16%/21% CAGR in revenue/EBITDA over FY24-27, with a 40 percent CAGR in free cash flow (FCF) due to capex moderation.</p>

<h3><strong>Data Patterns</strong></h3>
<p>Data Patterns, a leading private sector player in defense and aerospace electronic solutions, is rated 'Buy' with a target price of ₹3,545, indicating a 16.6% upside. The company's revenues are projected to rise nearly fivefold from FY24E-30E, benefiting from indigenization and export pipelines.</p>

<h3><strong>Entero Healthcare Solutions</strong></h3>
<p>Entero Healthcare Solutions is given a 'Buy' rating with a target price of ₹1,510, reflecting a 48% upside. The company is a fast-growing healthcare products distributor, expected to achieve a 20 percent organic revenue CAGR for FY24-26E and a 44 percent revenue CAGR over the same period.</p>

<h3><strong>Conclusion</strong></h3>
<p>Jefferies' expansion of coverage to 188 Indian stocks underscores the dynamic and growing nature of India's stock market. The newly covered stocks, including 360 One WAM, Adani Enterprises, Bharti Hexacom, Data Patterns, and Entero Healthcare Solutions, are poised for significant growth, driven by strong fundamentals and favorable market conditions. Investors should consider these insights while making informed investment decisions.</p>