Brokerage Picks: Motilal Oswal Unveils 4 Stocks with 34% Upside
Overview
Motilal Oswal reiterates a positive outlook on select equities, identifying four key stocks with 'Buy' ratings and significant upside potential. The firm cites improving fundamentals, sector-specific catalysts, and growth visibility as drivers for Avenue Supermarts, Infosys, JSW Energy, and Lemon Tree Hotels.
Brokerage Initiates Key 'Buy' Ratings
Motilal Oswal has maintained a constructive stance on the market, issuing 'Buy' recommendations for four specific companies with substantial upside potential. Avenue Supermarts, Infosys, JSW Energy, and Lemon Tree Hotels are highlighted, with targets suggesting gains of up to 34% from current levels. These selections are underpinned by robust operational performance and strategic growth initiatives.
Avenue Supermarts' Margin Strength
Avenue Supermarts, operating the popular DMart retail chain, received a 'Buy' rating with a target price of ₹4,600, signaling a 21% upward trajectory. The brokerage report highlighted a strong third quarter of fiscal year 2026, where profitability saw a notable improvement. Gross margins expanded by 50 basis points year-on-year to 14.6%, attributed to GST reductions and a favorable product mix. Operating margins also improved as retail costs stabilized.
Infosys Poised for AI Growth
For IT services major Infosys, Motilal Oswal reiterated its 'Buy' call with a target of ₹2,150, implying a 33% upside. The firm believes Infosys is strategically positioned to capture enterprise spending on artificial intelligence. Current valuations are seen as favorable, with the brokerage anticipating the current cycle to bottom out in calendar year 2026, paving the way for significant acceleration in the latter half of fiscal year 2027 and fiscal year 2028. Infosys remains a preferred large-cap IT pick.
JSW Energy's Capacity Surge
JSW Energy also secured a 'Buy' rating, with a target price of ₹657, indicating a potential 34% increase. The company has dramatically expanded its operational capacity, nearly doubling it from 7.2GW at the end of FY24 to 13.2GW by Q2FY26. This rapid execution, coupled with reduced merchant power exposure and a strong pipeline of long-term power purchase agreements, enhances cash flow stability. Motilal Oswal projects substantial EBITDA and PAT growth for JSW Energy through fiscal year 2028.
Lemon Tree's Asset-Light Strategy
Lemon Tree Hotels received a 'Buy' recommendation with a target price of ₹200, suggesting an approximate 33% upside. The brokerage points to the company's dual business model, combining asset-light hotel management with ownership and development. A planned corporate restructuring involving Fleur Hotels aims to create two focused entities, simplifying operations and supporting growth. Motilal Oswal forecasts steady annual growth in revenue, EBITDA, and profit after tax for Lemon Tree through fiscal year 2028.
