Kotak Mahindra Bank, M&M and Sona BLW Precision clinch fresh 52-week high; here’s why

On Monday, over 152 stocks advanced to 52-week highs. The benchmark indices, NIFTY50, traded at a 25,881 level up 0.35%, and SENSEX at 84,733 level, up 0.22%. The Nifty Bank is at the 53,978 mark, up 0.34%, while the fear gauge India VIX spiked to 13.47 level.

The broader market indices traded in positive terrain, with Nifty Midcap 100 up 0.55% and Nifty Smallcap 100 up 0.80%. The major sectoral indices traded in green except for Nifty IT, which is down 0.77%, while Nifty Private Banks is trading on a muted note, down by 0.06%.

Top three stocks that hit a fresh 52-week high on Monday, September 23, 2024

Kotak Mahindra Bank jumps on positive outlook

Kotak Mahindra Bank Ltd - India’s leading private sector lender’s share price traded to a 52-week high at ₹1,928.85 after surging over 1.28% in Monday’s session. It also surpassed the company's market cap mark of ₹3.83 lakh crore.

The share price witnessed an uptick after the Fed announced an interest cut on September 18. Since then the stock has rallied nearly 5%.

The rate cuts going ahead could impact banking sector return on asset (RoA) and net interest margin (NIM). Further the impact of NIM would be higher for Kotak Mahindra Bank due to its loan book’s 30 -60% exposure to repo and external benchmark linked loans. However, its impact on profitability will be lower as the bank could benefit out of treasury profits due to rate cuts. Kotak Mahindra has 80% of its investments in marked-to-market buckets (HFT and AFS).

In Q1FY25, Bank’s consolidated profit after tax (PAT) was ₹7,448 crore, up 79% YoY from ₹4,150 crore in Q1FY24, which included gains of ₹3,013 crore divestment of stake in Kotak General Insurance. ROA (annualised) excluding gains on divestment of stake in Kotak General Insurance stood at 2.30%. Average Total Deposits grew to ₹435,603 crore up 21% YoY.

As of June 30, 2024, Gross NPA was 1.39% & Net NPA was 0.35% compared with Gross NPA of 1.77% and Net NPA of 0.40% in the corresponding year.

Shares of Kotak Mahindra Bank surged 10% in the last 6 months, underperforming the benchmark Nifty Bank return of 15.79% in the same period.

Mahindra & Mahindra shines on optimistic EV outlook

Mahindra & Mahindra (M&M) Ltd - The homegrown carmaker’s scrip traded 2.48% higher on Monday, peaking at a 52-week high at ₹3,024. The stock witnessed a strong buying interest as trade volume surged to 15.83 lakh shares with a trade value worth ₹475 crore.

Further the stock has gained over 9% in just the last 5 trading sessions.The investors remain bullish on stock as the company comes up with Battery Electric Vehicle (BEV) launches that are expected to be profitable and due to growing popularity of XUV 700’s affordable variants. On October 3, Mahindra is set to launch its new commercial EV named ‘e-ZEO’

Additionally, early signs of recovery are becoming visible in rural markets post-good monsoon season, and the tractor market outlook is looking stronger.

In 2024, so far the M&M shares have rallied a whopping 71% on year to date basis.

Sona BLW Precision Forgings rides momemtum after succesful QIP

Sona BLW Precision Forgings Ltd, a critical automotive system and component stock manufacturer surged to a 52-week high of ₹768.65, rising 2.71% during Monday's morning session.

On September 9th, the company announced that it had successfully raised ₹2,400 crore via qualified institutional placement (QIP). From the proceeds from the QIP, the company’s capital structure will be further bolstered to support its organic and inorganic growth strategies.

The stock is witnessing strong buying interest post auto component maker’s impressive results in Q1 and a strong order book.

In Q1FY25, the company reported profit after tax (PAT) surged approximately 24 % YoY to ₹140 crore while revenue grew to ₹890 crore, up 22% YoY. The company's EBITDA margin stood at 29%, Electric vehicle (EV) revenue contributed 33% of the total revenue, reflecting Sona BLW's growing focus on the EV segment. The company's order book expanded to ₹23,300 crore during the quarter, up from ₹22,600 crore in Q4FY24, with battery electric vehicles (BEVs) comprising 79% of the new orders.