As tensions escalate between India and Pakistan following Operation Sindoor, the stock market exhibits a surprisingly composed response to these geopolitical uncertainties. Investors are in a phase of cautious observation, but opportunities for savvy purchases remain. Leading brokerage firm Motilal Oswal has identified ten promising stocks that they recommend for purchase, indicating strong long-term potential despite the current market fluctuations.

Top Stock Picks from Motilal Oswal

Motilal Oswal’s analysis spans various sectors including mining, FMCG, and banking, providing a comprehensive look at their top recommendations.

1. Coal India: Target Price Rs 480

Motilal Oswal has maintained a Buy rating for Coal India, targeting a price of Rs 480, which translates to a 25% upside from current trading levels. The brokerage notes a robust recovery in Q4 after a sluggish start to FY25, with an optimistic outlook on the company’s coal-washing capacity expansion.

• Expected volume growth at 8% CAGR from FY25 to FY27.
• Valuation based on 4.5x FY27E EV/EBITDA supports the bullish stance.

2. Godrej Consumer: Target Price Rs 1,450

Offering a 16% upside, Motilal Oswal has set a target price of Rs 1,450 for Godrej Consumer Products. The firm highlights the company’s strategy to reposition various products at competitive price points to attract a wider customer base.

• Despite slight reductions in earnings forecasts due to urban demand challenges, innovation and category expansion keep the stock appealing.
• Target valuation based on 50x FY27E EPS.

3. Punjab National Bank: Target Price Rs 125

Punjab National Bank is another Buy recommendation with a target price of Rs 125, suggesting a 33% upside potential. The bank’s improving profitability metrics and better recovery trends make it an attractive option.

• The SMA book for loans over Rs 50 million has improved to 0.02% of domestic loans.
• Expected RoA/RoE of 1.05%/15.5% in FY27E.

4. Polycab India: Target Price Rs 7,250

Motilal Oswal projects a 23% upside for Polycab India with a target price of Rs 7,250. They forecast impressive growth rates, estimating a CAGR of 16% across revenue, EBITDA, and PAT from FY25 to FY27.

• Strong cash flows and improved liquidity position Polycab for growth.
• Valuation based on 40x FY27E EPS.

5. HPCL: Target Price Rs 455

With a target price of Rs 455, HPCL is rated as a Buy, indicating a 15% potential upside. The company is favored among oil marketing firms due to its strong dividend yield and increased leverage toward the marketing sector.

• Anticipated startup of mega-projects in the next year will significantly boost earnings.
• Valuation at 1.5x FY26E P/B offers a margin of safety.

6. APL Apollo Tubes: Target Price Rs 1,920

APL Apollo Tubes is also on the Buy list with a target price of Rs 1,920, reflecting a 15% upside. The company is expected to benefit from recovering demand and strategic capacity expansions.

• Projected 20% volume CAGR over the next two years.
• Revenue, EBITDA, and PAT expected to grow at 19%/27%/43% CAGR from FY25-27E.

7. Mahanagar Gas: Target Price Rs 1,760

Motilal Oswal has reiterated a Buy rating for Mahanagar Gas, setting a target price of Rs 1,760, implying a 25% upside. The firm anticipates a 10% volume CAGR supported by initiatives like CNG conversions for commercial vehicles.

• Collaborations with OEMs are expected to expand the customer base.
• Trading at 12.6x FY26E SA P/E, which offers solid value.

8. Niva Bupa: Target Price Rs 100

Niva Bupa has received a Buy rating with a target price of Rs 100, suggesting a 23% upside. The company’s impressive performance in Q4 FY25, driven by cost efficiency and improved expense ratios, supports this recommendation.

• Operational improvements are expected to enhance scalability and profitability.
• Valued at 40x FY27E IFRS PAT.

9. Sapphire Foods: Target Price Rs 400

Sapphire Foods is rated as a Buy with a target price of Rs 400, indicating a potential upside of 29%. The continued expansion of KFC outlets and innovative product offerings are key growth drivers.

• The stock trades at reasonable multiples of 28x and 22x pre-Ind-AS EV/EBITDA for FY26E and FY27E, respectively.

10. Avalon Technologies: Target Price Rs 1,030

Finally, Avalon Technologies has a Buy rating with a target price of Rs 1,030, suggesting a 17% upside. The brokerage remains optimistic about Avalon’s growth in both domestic and international markets, driven by strategic expansion.

• Expected CAGR of 28% in revenue and 40% in EBITDA over the next two years.

Conclusion

Despite the geopolitical tensions, Motilal Oswal is optimistic about these ten stocks, each showing robust long-term potential. Investors looking for opportunities amid current market uncertainties may find these recommendations worthwhile as they navigate through the complexities of the financial landscape.