The brokerage firm, Motilal Oswal has set its sight on a select group of stocks with growth potential, offering a ‘Buy’ rating on companies. From FMCG giants to defence leaders, and tech innovators, these stocks are capturing the brokerage’s attention. Let’s dive into the key picks, including Hindustan Unilever, Hindustan Aeronautics, SBI Life Insurance, Tech Mahindra, Persistent Systems, and Dalmia Bharat, and explore the reasons behind Motilal Oswal’s optimistic outlook on these stocks.
Hindustan Unilever
Motilal Oswal remains optimistic on HUL despite mixed performance in Q4FY25. Revenue rose 3% YoY to Rs 15,450 crore, with 2% volume growth.
“Rural demand continues to show gradual improvement, while urban demand remains subdued.”
As per the brokerage house report, Home Care grew in volumes but saw a 2% drop in EBIT due to price cuts. Beauty & Wellbeing delivered 6% revenue growth and 15% EBIT growth, led by a strong hair care portfolio. Personal Care and Oral Care saw low volume or flat growth, but pricing supported revenues.
Furthermore, the firm in its report added that the Food & Refreshment segment struggled, with a 1% drop in revenue and 15% EBIT decline. Management has lowered its EBITDA margin guidance to 22-23%, focusing now on volume growth and new launches.
Hindustan Aeronautics
With defense capex rising and supply chains stabilising, Motilal Oswal sees HAL on solid footing. The brokerage noted, “We expect the company’s overall revenue to record a CAGR of 29% over FY25-27, primarily driven by a sharp scale-up in manufacturing.”
The brokerage noted that the HAL is expected to maintain robust EBITDA margins of 25.9%–27.6% over the next three years.
The company’s PAT is also projected to grow at 29% CAGR, supported by indigenous manufacturing and capex plans of Rs 30-50 billion annually.
SBI Life Insurance
The brokerage is bullish on SBI Life after its strong Q4FY25 performance. New business APE grew 2% YoY to Rs 5,450 crore, and VNB rose 10% to Rs 1,660 crore.
“Strong growth in VNB was attributed to a significant shift in the product mix to non-ULIP products.”
The brokerage noted in its report that the company’s VNB margin expanded to 30.5%, well above expectations. FY25 PAT grew 27% YoY to Rs 2,400 crore. For FY26, management expects 13-14% APE growth, led by a 25% jump in agency channel productivity.
The brokerage expects a 15% CAGR in APE and 17% in VNB over FY25–27, with RoEV holding at around 19%.
Tech Mahindra
Motilal Oswal has given a ‘Buy’ call on Tech Mahindra, setting a target price of Rs 1,950, which suggests a 35% upside from current levels.
As per the brokerage firm report, revenue for Q4FY25 stood at USD 1.5 billion, down 1.5% QoQ in constant currency, but key verticals like BFSI and Communications grew 2.4% and 1.0%. EBIT margin rose 40 basis points QoQ to 10.5%, ahead of estimates.
“We remain positive about the restructuring at TECHM under the new leadership and believe this quarter was another step in the right direction,” the brokerage house noted in its report.
According to the brokerage, the bottom-up transformation seems “relatively independent of discretionary spending,” making it more resilient. The brokerage firm values the stock at 25x FY27E EPS, implying 35% upside from current levels.
Persistent Systems
The brokerage firm has reiterated its ‘Buy’ rating on Persistent Systems, with a target price of Rs 6,450, betting on the company’s strong revenue growth and margin expansion
The company’s Q4FY25 revenue rose 4.2% QoQ in USD terms, ahead of estimates. EBIT margin expanded to 15.6%, with EBIT growing 10.9% QoQ. FY25 saw 21.6% YoY revenue growth, and the company reaffirmed its USD 2 billion revenue target for FY27.
The brokerage expects 19% revenue CAGR in USD terms over FY25–27, with over 23% EPS CAGR supported by margin gains. “We maintain our estimates for FY26E while we revise our FY27 estimates upward by 4%,” it added.
Dalmia Bharat
The brokerage firm recommends a ‘Buy’ on Dalmia Bharat, raising the target price to Rs 2,300 from Rs 2,150.
“Dalmia Bharat is among the low-cost producers in the industry, backed by a higher blending ratio, green power share, and lower freight costs.”
The company’s capacity expansion plans in Karnataka and Maharashtra address long-standing growth concerns. Rising cement prices, especially in southern India, are likely to boost profitability in FY26.
The brokerage firm has raised its EPS estimates by 22% for FY26 and now values the company at 12x FY27E EV/EBITDA, citing attractive valuations.