Religare's List of 13 Midcap Stocks That Can Beat Sensex

1) Ashiana Housing (target Rs 290): The company is planning on-time delivery of nine projects in FY16 - this would boost revenues and help strengthen its brand equity across existing markets, besides giving it a foothold in new cities.

2) Bata India (target Rs 1,700): Expanding footprint will accelerate growth. Same store sales growth is expected to recover as demand picks up. Operating leverage benefits likely from product mix changes and traction in new large-format stores. Valuations are reasonable.

3) CESC (target Rs 675): Best play in the private integrated power project space. Losses have ebbed at Spencer's and the Haldia plant would be profitable from FY16 onwards.

4) Cholamandalam Investment and Finance (target Rs 900): Top mid-cap NBFC pick. Expect higher net interest margins and rising operating efficiency to support return on assets. Loan growth would remain ahead of peers led by expansion across geographies and products.

5) Gulf Oil Lubricants (target Rs 595): The stock is trading at a significant discount to market leader Castrol. Expect further re-rating on the back of growing market share coupled with margin expansion led by softer raw material prices and stronger brand traction.

6) NCC (target Rs 100): Loan recovery from subsidiaries and order book expansion are possible triggers for the construction company. A progressively lighter balance sheet would lower interest costs, shoring up net profit.

7) Natco Pharma for a target of Rs 3,005: Dual play on its leadership position in the domestic oncology market and a robust US product pipeline, backed by strong R&D capabilities. The stock has re-rated on the likely launch of generic Copaxone. Drug pipeline is robust. The company can sustain its growth momentum.

8) Orient Cement (target Rs 230): Volumes to get a boost post the expansion drive in Karnataka. Demand recovery is expected in the southern market led by infrastructure-led government spending in the new Telangana state.

9) Shemaroo Entertainment (target Rs 420): Apart from its traditional business of television broadcast syndication, the company offers 3,000 movies on digital platforms. It plans to expand the content library to 5,000 titles by 2019, along with a rising share of the high-margin new media (internet) business.

10) SKF India (target Rs 1,620): It is well placed to leverage on the improvement in bearings demand over FY15-FY17 given its broad product profile and diverse end-use customer base. The company has consistently maintained a leadership position in the bearings industry. It has a strong product profile, brand and distribution channel.

11) Somany Ceramics (target Rs 535): SOMC is the third largest organised tiles player in India with a focus on tier-2 and 3 cities. The company has more than doubled capacity in last five years and plans to ramp up further. It has an asset-light model. Growing realisations from value-added products and portfolio extension should support profit.

12) Strides Arcolab (target Rs 1,685): Merger with Shasun will lead to vertical integration and other strategic benefits, while Arrow's acquired portfolio provides sustainable cash flows. Improving return ratios should narrow the valuation discount to peers. Upside from the Sovaldi (anti-hepatitis drug) lends further comfort.

13) V-Mart Retail (target Rs 800): With 110 stores in 92 tier II & III cities, the company is a play on the growing organised apparel market, high aspirational demand and rising purchasing power of middle-class India. Plans to widen its footprint to 177 stores by FY18 should support robust revenue growth.