12 Stocks to Give 42 Percent Return in 1 Year. All Got Strong Buy Recommendations.

Global brokerage firm BofA Securities has projected a strong outlook for the Indian stock market, predicting that the Nifty 50 index could reach 25,000 by the end of the year. This represents a 14% increase from current levels. The forecast comes at a time when Nifty has declined by 16% from its September 2024 high of 26,277.

While expressing caution over small-cap and mid-cap stocks, BofA has recommended 12 large-cap stocks, most of which belong to the Nifty 50 index. The brokerage expects returns ranging from 10% to 42% on these stocks.

Top 12 Stocks Recommended by BofA Securities

1. HDFC Life (HDFC Life)

   • Target Price: ₹875
   • Expected Growth: 42%
   • Reason: Expansion of new branches, strong product mix, and increasing market presence in Tier-2 and Tier-3 cities.

2. Mahindra & Mahindra (M&M)

   • Target Price: ₹3,650
   • Expected Growth: 40%
   • Reason: Strong position in the SUV market, robust tractor business, and well-planned electric vehicle (EV) strategy despite Tesla’s anticipated entry into India.

3. Bharti Airtel (Airtel)

   • Target Price: ₹2,085
   • Expected Growth: 31%
   • Reason: Anticipated tariff hikes, growing data usage, and improved cash flow.

4. Larsen & Toubro (L&T)

   • Target Price: ₹4,150
   • Expected Growth: 30%
   • Reason: Strong order book, government capital expenditure (Capex) policies, and the possibility of a share buyback.

5. Titan Company (Titan)

   • Target Price: ₹3,980
   • Expected Growth: 29%
   • Reason: Gold exchange programs, expansion in the wedding segment, and strong brand value.

6. Axis Bank (Axis Bank)

   • Target Price: ₹1,300
   • Expected Growth: 29%
   • Reason: Attractive valuation, strong balance sheet, and favorable risk-reward ratio.

7. Infosys (Infosys)

   • Target Price: ₹2,150
   • Expected Growth: 26%
   • Reason: Strong presence in cloud, data, and ERP services, coupled with attractive valuation.

8. Shriram Finance (Shriram Finance)

   • Target Price: ₹780
   • Expected Growth: 26%
   • Reason: Stable asset quality, strong balance sheet, and favorable funding costs.

9. ICICI Bank (ICICI Bank)

   • Target Price: ₹1,500
   • Expected Growth: 24%
   • Reason: Strong asset quality and a high provision buffer, making it a safe investment.

10. Divis Laboratories (Divis Labs)

    • Target Price: ₹6,850
    • Expected Growth: 24%
    • Reason: Capacity expansion and rising demand for GLP-1 products could drive earnings growth above 25% in the next two years.

11. Eicher Motors (Eicher Motors)

    • Target Price: ₹6,000
    • Expected Growth: 22%
    • Reason: Stronghold in the premium motorcycle segment with Royal Enfield’s growing sales.

12. Bajaj Finance (Bajaj Finance)

    • Target Price: ₹9,350
    • Expected Growth: 9%
    • Reason: Strong asset quality, industry-leading growth, and stable credit cost make it a safe investment option.

Market Outlook

With Nifty 50 expected to recover strongly by year-end, large-cap stocks appear to be a safer bet. Investors are advised to be cautious with small-cap and mid-cap stocks while considering high-growth potential companies recommended by BofA Securities.