The domestic brokerage house, Motilal Oswal, has identified three stocks with significant upside. The brokerage sees as much as 37% upside potential in select stocks over the next 12 months. It identified these stocks on the back of continued growth, consumption recovery, project execution, etc.
Here’s a detailed analysis of the investment rationale –
Motilal Oswal on ACME Solar
Motilal Oswal retained a ‘Buy’ rating on ACME Solar Holdings. The brokerage house kept the target price of Rs 341 on the stock, translating into an upside potential of more than 34%. It believes that the company has strong earnings visibility as its portfolio currently stands at 8.1GW (comprising 3GW operational capacity and 5.1GW under construction), with 78% of capacity backed by PPAs (Power Purchase Agreements).
Motilal Oswal believes that as projects under construction are commissioned, operational capacity is expected to increase from 2.5GW at the end of FY25 to 5.5GW by the end of FY28, driving EBITDA per adjusted net profit CAGR of 74%-76% over FY25–28.
In terms of execution, ACME has obtained transmission connectivity for nearly all of its 5.1GW of capacity currently under construction and holds a connectivity inventory of 7.5GW (1.3GW secured and 6.2GW applied for), which gives it a competitive advantage when competing for future projects and reduces the risks associated with execution delays.
Motilal Oswal on Dabur
Motilal Oswal has set a target of Rs 515 per share on the FMCG giant, Dabur India. This implies that the stock may rally over 14% over the next 12 months. However, the brokerage house maintained its ‘Neutral’ rating on the stock.
The firm’s management expects mid-single-digit growth in the near term, while looking at high-single-digit growth for the India business.
The company also went through a leadership change. Nomura said that any change in strategic priority by the new CEO will be watched carefully.
“We remain positive on consumption recovery, supported by improving domestic macros, but cautious on global uncertainties. However, Dabur’s consistent weak execution, despite macros turning positive, is concerning, in our view,” said the brokerage house.
However, the stock price of Dabur has remained range-bound over the last five years.
Motilal Oswal on Poonawalla Fincorp
Motilal Oswal has a ‘Buy’ recommendation on Poonawalla Fincorp, with a target price of Rs 560, implying an upside of 37% from the current market price.
The non-deposit-taking NBFC is evolving into a structurally stronger, digitally enabled, and well-diversified retail NBFC. The company is supported by disciplined growth execution, improving asset quality, and visible operating leverage.
The company, which is engaged in providing consumer and MSME financing, calibrated its shift toward secured and prime lending segments, combined with an improving bias in margins and a gradual moderation in credit costs, should enhance its earnings visibility while reducing volatility across cycles.
“At the same time, sustained investments in technology, AI and governance frameworks are driving productivity gains and improving operational efficiency, even as the company continues to expand its branch network and geographic footprint,” said the brokerage house.
Overall, the brokerage is positive on all three stocks it pitched out today. These might generate returns of up to 37% on the back of strong fundamentals.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.
