As the new month kicks off, the brokerage firm Motilal Oswal has released a fresh list of stock recommendations. The brokerage has issued a “Buy” call on eight stocks, projecting upside potential ranging from 14% to 32%. Here’s a look at these picks and the rationale behind them:
State Bank of India
The brokerage has given a Buy rating to the stock with a target price of Rs 925, which translates to an upside of 14%.
According to the brokerage report, State Bank of India (SBI) has ticked all the big-bank boxes in FY25 steady business growth, tight control on bad loans and a balance sheet sturdy enough to weather rate-cut headwinds.
“We estimate a 6 % earnings CAGR over FY25-27, with an RoA/RoE of ~1.0 %/15.9 % in FY27,” added Motilal Oswl in its report.
Net interest margin (NIM) has slipped recently, but management sees it holding broadly steady even if there is a “negative bias depending on the timing of rate cuts.”
“With prudent underwriting and continued recoveries,” the brokerage say credit costs should hover around 50 bps over the next two years. That restraint is baked into the 6 % earnings growth forecast through FY27.
Adani Ports & SEZ
Motilal Oswal’s Rs 925 target is built on 1.2× FY27E adjusted book value for the core bank plus Rs 245 per share for its insurance, asset-management and cards subsidiaries.
The brokerage has given a Buy rating to the stock with a target price of Rs 1,700, which implies an upside of 19% from current levels.
According to the brokerage report, Adani Ports & SEZ (APSEZ) is gearing up for a significant transformation. The firm expects its logistics business to multiply fivefold over FY25-29, with revenues soaring to Rs 140 billion by FY29 from Rs 28 billion in FY25.
As the report puts it, “The integration of the logistics business with the ports business is enhancing APSEZ’s service offerings and transforming the company into a transport utility.”
Motilal Oswal values APSEZ at a multiple of 16 times FY27E EV/EBITDA, leading to their revised target price of Rs 1,700.
“We reiterate our BUY rating with a TP of INR1,700 (premised on 16x FY27E EV/EBITDA),” the report noted.
Apollo Hospitals
Apollo Hospitals has been rated Buy with a target price of Rs 8,050, offering an upside of 17%.
As per the brokerage report, Apollo Hospitals is expected to benefit from improved productivity and a turnaround in its diagnostics and digital health verticals.
“We expect a 15%/17%/23% CAGR in revenue/EBITDA/PAT over FY25-27,” said Motilal Oswal.
Valued using the SoTP method, the brokerage assigns different multiples to Apollo’s businesses, such as 30x EV/EBITDA for hospitals and 2x EV/sales for Apollo 24/7. It sees the company leveraging operational efficiency and new bed additions to drive future gains.
Prestige Estates Projects
Motilal Oswal has given a Buy rating on Prestige Estates with a revised target of Rs 1,938, suggesting an upside of up to 32% as the realty major advances its residential and commercial projects.
Although FY25 bookings fell short of guidance due to delayed approvals, the pipeline for FY26 looks robust.
“As the company advances its growth trajectory in both residential and commercial segments and unlocks value from its hospitality segment, we believe the stock is set for further re-rating,” the report noted.
IPCA Laboratories
IPCA Labs has been assigned a Buy rating with a target price of Rs 1,750, pointing to a 17% upside.
Despite trimming earnings estimates slightly, the brokerage remains positive on IPCA Labs, citing execution in the domestic formulation (DF) segment and synergy benefits from its Unichem acquisition.
“We expect an 11%/18%/15% sales/EBITDA/PAT CAGR over FY25–27,” it said.
IPCA reported 4QFY25 sales of Rs 22.4 billion, up 10.5% YoY, with healthy growth in domestic and export formulation sales. EBITDA margins also expanded by 330 basis points YoY to 19.1%.
Sobha
Sobha has been rated Buy with a revised target of Rs 1,778, implying an upside of 24%.
Real estate developer Sobha is on the radar for its strong growth visibility backed by vast land reserves and a recent fundraise that supports new acquisitions.
“Ongoing and upcoming projects are likely to generate ~Rs 124 billion of gross cash flows, which we value at around Rs 74 billion,” Motilal Oswal estimated.
The company’s updated launch pipeline and monetization potential from 154 million sq ft of land provide a solid foundation for future performance.
Lemon Tree Hotels
Lemon Tree Hotels gets a Buy rating with a target price of Rs 200, indicating a 16% potential upside.
Motilal Oswal believes Lemon Tree Hotels is poised for further growth after a strong FY25, supported by occupancy rate improvements and rising room rates.
“We expect the momentum to remain intact in FY26, led by the ramp-up of Aurika Mumbai, favorable demand-supply dynamics, and renovation-driven boost in ARR and OR.”
EBITDA margins also improved due to operating leverage. The company’s loyalty program (Infinity 2.0) and expansion pipeline (~6,591 rooms) are expected to further lift performance.
Spandana Sphoorty
The brokerage has given a Buy rating to the stock with a target price of Rs 340, which translates to an upside of about 17 per cent from current levels.
Motilal Oswal highlights that FY25 ended on a shaky note – disbursements dropped, the loan book shrank, and credit costs spiked as Stage-2 assets flowed into slippages. The brokerage expect that pain to linger through the first half of FY26. Even so, they project an 18 per cent AUM CAGR between FY25 and FY27 and believe collection efficiency is “still improving – normalisation is a few quarters away, but visible.”
The brokerage models a return on assets/return on equity of 2 per cent/8 per cent by FY27, despite elevated credit costs in the short run.
At just 0.8× FY27E P/BV, the stock trades below its historical range and peers. Motilal Oswal notes, “The slightest hint of operational stability could trigger a meaningful re-rating.”
As the report sums up, “We maintain our BUY rating with a TP of Rs 340, confident that Spandana’s undemanding valuation offers a favourable entry point for patient investors.”