Stock market recommendations: According to Motilal Oswal Financial Services Ltd, the top stock picks for the week (starting April 7, 2025) are Trent and HDFC Bank. Let’s take a look:
Trent:
Trent surpassed the milestone of 1,000 fashion stores for FY25, reaching a total of 757 Zudio stores—an increase of 39%—and 248 Westside stores, marking 6% growth. In the March 2025 quarter alone, 122 new Zudio stores were added. Trent’s industry-leading growth, driven by healthy SSSG, store productivity, and robust footprint additions, along with the scale-up of Zudio and newer categories, offers a huge runway for growth over the next few years. TRENT’s focus on ramping up Star through Fresh and its own brands provides an additional growth driver in the grocery segment. We estimate a revenue/EBITDA/PAT CAGR of 32%/34%/39% over FY24-27, driven by 21% CAGR in area additions & mid-single-digit improvement in productivity.
HDFC Bank:
HDFC Bank is effectively addressing post-merger challenges (high CD ratio, costly borrowings) through robust deposit mobilization (+15% CAGR FY25-27E) and portfolio rebalancing toward high-yielding Retail/Commercial & Rural Banking loans (~11% CAGR). NIMs (3.43% in 3QFY25) are poised to expand to 3.5-3.6% by FY27 as funding costs ease, supported by a rising CASA mix. Prudent asset quality (GNPA/NNPA: 1.4%/0.4%) and a hefty INR262b provision buffer mitigate risks. Operational streamlining (cost-to-income: ~40% by FY27) and margin recovery underpin RoA/RoE targets of 1.8%/14.1%.
Disclaimer: The opinions, analyses and recommendations expressed herein are those of brokerage and do not reflect the views of The Times of India. Always consult with a qualified investment advisor or financial planner before making any investment decisions.
