Zomato, Suzlon, PNB, Shakti Pumps: These 120 companies posted over 100% jump in profit in Q1. Should you buy?

If stock prices are slaves to earnings in the long run then it makes sense on Dalal Street to look for a company that has reported robust financial results for the quarter ended June 30. Data available with Ace Equity until August 1 showed that at least 120 firms have observed more than 100% growth in net profit in Q1FY25 and market analysts are bullish on a couple of firms at their current prices.

Among the well-known names on the list, the net profit of food delivery aggregator Zomato climbed manifold to Rs 253 crore during the quarter under review. It reported a profit of Rs 2 crore in the corresponding quarter last year.

According to Emkay Global Financial Services, Zomato once again churned out impressive results, with all segments registering healthy growth. For food delivery, the management sees gross order value growth sustaining at over 20% in the near term, slightly lower than in the last few quarters. Blinkit’s stellar growth is complemented by continued improvements in profitability, where it sustained adjusted EBITDA breakeven despite investing in new stores. The management now targets a store count of 2,000 for Blinkit by 2026, as it continues its expansion spree for seizing market opportunities.

“We maintain ‘Buy’ on Zomato with a target price of Rs 270 per share,” Emkay Global Financial Services said in a report.

Shakti Pumps (India) stood next on the list. The company reported a net profit of Rs 92.66 crore for the quarter ended June 2024 against Rs 1 crore in Q1FY24.

Sharing his views on Shakti Pumps (India), Dinesh Patidar, Chairman of the company said, “This commendable performance is attributable to the accelerated execution of the existing orders in both domestic and export markets. Furthermore, the improvement in margins was achieved due to a decline in raw material prices, coupled with economies of scale resulting from higher execution during the quarter.”

“We continue to maintain a healthy order book of around Rs 2,000 crore as of June, which is expected to be implemented in the next 15 months. Additionally, we continue to witness a strong momentum in the export market, which is contributing positively to our growth,” Patidar said in a release.

Net profit of Multi Commodity Exchange increased by 464% YoY in Q1FY25, Adani Enterprises by 116% and Geojit Financial Services by 112%. Motilal Oswal Financial Services is positive on MCX with a target price of Rs 4,850.

State-owned lenders Punjab National Bank and UCO Bank also posted 196% and 147%, respectively, rise in net profit in Q1FY25. On the other hand, real estate players including Macrotech Developers and Godrej Properties also reported a 166% and 316%, respectively, rise in net profit in the June quarter.

Brokerage Sharekhan has set a target price of Rs 140 for Punjab National Bank. “Improvement in asset quality is encouraging and the outlook remains strong. The bank has been guided that the quality of loans sanctioned in post-COVID times is far superior with very low delinquency. Thus, lower slippage trends are likely to sustain and narrow the perceived gap in underwriting with respect to peers. Credit cost is expected to fall to around 0.5% in FY25E. RoA guidance of 1% is expected to be achieved even before Q4FY25,” Sharekhan said in a report.

Nuvama Institutional Equities is also bullish on Macrotech Developers with a target price of Rs 1,874. “With the housing cycle turning, we expect the sales momentum to remain healthy. Pre-sales and cash flow trajectory would be the key triggers (for Macrotech Developers),” Nuvama said.

With over 10 times rise in net profit in the June quarter, Jubilant Pharmova, Lotus Chocolate Company, Greenply Industries, Mahindra Holidays & Resorts India, Sastasundar Ventures, AGS Transact Technologies, Shah Metacorp, Transcorp International, Maharashtra Scooters and Gujarat Cotex stood among other names on the list.

The data further highlighted that Suzlon Energy witnessed 200% growth in net profit at Rs 302.29 crore in Q1FY24 against Rs 100.90 crore in the same quarter last year. ICICI Securities in a report said that Suzlon Energy has reported an all-round beat in Q1FY25 with WTG volume of 274MW (up 2x YoY). Order inflow has remained healthy at 1.2GW in Q1, taking the order book to 3.8GW as of Jun 2024. “Moreover, order inflow outlook remains strong as hybrid and wind RE bidding has remained strong in FY24 and Q1FY25,” the brokerage said.

Geojit Financial Services recently initiated coverage on Suzlon with a target price of Rs 73. “Suzlon 2.0 is a de-levered, optimized, profit-making business which has done away with its troubled past and is looking at a vibrant landscape of opportunities in India and abroad,” Geojit Financial Services said.

The bottom line of Atishay, B2B Software Technologies, Trishakti Industries, Modi Naturals, Franklin Industries, WSFX Global Pay, Inventure Growth & Securities, National Fittings, PNGS Gargi Fashion Jewelery, Golkunda Diamonds & Jewelery, Aarnav Fashions, Odyssey Technologies, Privi Specialty Chemicals , Vikas EcoTech, SMIFS Capital Markets, Hybrid Financial Services, Ashapuri Gold Ornament, Multi Commodity Exchange of India, De Nora India, Mangalam Organics, Finolex Industries, Hitachi Energy India, Ashika Credit Capital, Continental Petroleums, Luharuka Media & Infra and SKP Securities also posted more than 100% growth in net profit during the quarter under review.