Mr Shrikant Chouhan Stocks to buy for the long term: The Indian stock market benchmark, the Nifty 50, is set to end the year with modest gains due to heavy foreign capital outflow, weak earnings, and US tariffs.
Year-to-date, the Nifty 50 is up nearly 10%, while the broader Nifty 500 has gained about 6%.
Expectations are rife that the coming year will be better than 2025 on earnings recovery and a healthy macroeconomic backdrop.
"We expect a somewhat better calendar year 2026 with a strong recovery in earnings, improved domestic consumption demand on the back of GST and income tax rate cuts and lower interest rates, and a likely better macro on the likely conclusion of the India-US trade deal," said brokerage firm Kotak Securities.
Shrikant Chouhan, the head of equity research at Kotak Securities, recommends 10 stocks to buy for the long term. Let's take a look
ICICI Bank | Previous close: ₹1,350.55 | Fair value: ₹1,800 | Upside potential: 33%
ICICI Bank is India's second-largest private bank with a diversified loan book of nearly 52% retail, nearly 21% business banking and nearly 20% corporate.
Domestic loans grew nearly 10.6% YoY in Q2FY26, led by strong business banking growth (nearly 25% YoY), while retail remains anchored in secured segments like home loans.
Chouhan said ICICI Bank's profitability stays best-in-class with net interest margin (NIM) at nearly 4.3%, RoA at nearly 2.3% and RoE at nearly 16-17%.
Asset quality remains pristine with GNPA at nearly 1.6%, NNPA at nearly 0.4% and credit costs at nearly 30-40 bps, supported by a strong, nearly ₹131 billion contingency buffer.
"Sectorally, H2FY26 should improve versus H1 as loan growth revives, margins bottom out and unsecured/MFI stress eases. Importantly, ICICI has corrected more than its peers, offering a better risk-reward at current valuations," said Chouhan.
Aadhar Housing Finance | Previous close: ₹484.35 | Fair value: ₹625 | Upside potential: 29%
Chouhan said the affordable housing finance sector remains structurally attractive, supported by rising urbanisation, PMAY-driven demand and improving affordability.
While the first half of FY26 (H1FY26) saw some moderation in disbursements, the second half of the year (H2FY26) is expected to improve as rate cuts flow through and growth momentum normalises.
Chouhan pointed out that Aadhar Housing stands out with a ₹276 billion AUM (+21% YoY), 100% secured retail book, and strong profitability with ROA of nearly 4.2% and ROE trending towards 17-18%. Asset quality remains pristine with GNPA at nearly 1.4% and credit costs at about 0.2-0.3%.
"Sector valuations have corrected to nearly 2.2-2.6 times FY27E P/B, offering favourable risk-reward. With Sectoral tailwinds and attractive valuation, Aadhar offers good upside and remains among the best-positioned affordable housing finance company plays," said Chouhan.
Jindal Steel | Previous close: ₹986.50 | Fair value: ₹1,250 | Upside potential: 27%
Jindal Steel (JSL) is a leading integrated steel producer with strong footholds in steel, mining, and power.
JSL successfully commissioned phase-1 of its BF/BOF expansion of 4.6/3 mtpa capacity in Q2FY26, with phase-2 of its expansion on track to be completed in H1FY27E.
The new projects are focused on producing higher-margin products, which should support sustained profitability.
"With a growing share of value-added products and capacity ramp-up ahead, we estimate a healthy 21% EBITDA CAGR and 30% EPS CAGR over FY25-28E, positioning JSL for a robust earnings growth phase. We expect net debt to remain capped during the current capex cycle, with leverage staying below 1.5 times over FY26-28E," said Chouhan.
Eureka Forbes | Previous close: ₹636.10 | Fair value: ₹800 | Upside potential: 26%
Chouhan underscored that Eureka Forbes' product portfolio encompasses water purification, vacuum cleaning and air purification.
It has direct, retail, e-commerce and institutional sales channels, an inventive business partner network and one of the most expansive service networks across India.
The company aspires to grow at a 17-18% CAGR in overall sales over FY25- 30E. Adjusted EBITDA is expected to see 23-24% CAGR over FY2025-30E. The adjusted EBITDA margin expansion to 15% will be largely driven by operating leverage.
"Eureka Forbes has seen double-digit revenue growth in FY25 and H1FY26 with healthy margin expansion. We estimate 14%/25%/31% revenue/EBITDA/PAT CAGRs over FY25-28E," said Chouhan.
Amber Enterprises | Previous close: ₹6,647.40 | Fair value: ₹8,100 | Upside potential: 22%
According to Chouhan, within the RAC (room air conditioners) segment, volumes are rebounding in Q3FY26; the company expects to outperform the industry by 12-15% for the year, although raw material cost inflation will impact margins.
For electronics, full-year margins are guided at 8-9%, supported by the recent acquisitions, but delivery remains key as the first half of FY26 (H1FY26) margin was 6.3%.
For consumer durables, the management reiterated its guidance of outgrowing the industry by 12-15%.
"We expect revenues to see a CAGR of 23% over FY25-28E, driven by growth in components- electronics and Sidwal. We expect EPS (earnings per share) to grow by 61.5% in FY27E and by 31.5% in FY28E," said Chouhan.
Thermax | Previous close: ₹3,011.70 | Fair value: ₹3,575 | Upside potential: 19%
Chouhan pointed out that Thermax is benefitting from scale-up in existing businesses, geographical expansion and entry into new businesses.
New growth markets include datacenters, entry into O&G in the Middle East and HRSG prospects for gas-to-power (Middle East). (HRSG: Heat Recovery Steam Generator, O&G: Oil and Gas).
Chouhan said margin improvement appears imminent due to a reduction in the share of troubled orders, a rebound in the chemical business and positive mix effects in the product segment.
Management has guided for a 20% YoY growth in ordering for FY26, aligned to the H1FY26 run-rate.
"Thermax appears attractively valued on trailing earnings; recent price correction provides an attractive entry. We maintain fair value at ₹3,575 at 40 times two-year forward earnings and nearly 6% value from green energy and thermal project," said Chouhan.
Mahindra & Mahindra (M&M) | Previous close: ₹3,621.20 | Fair value: ₹4,200 | Upside potential: 16%
Chouhan said M&M continues to execute well by maintaining a leadership position in all three segments, which keeps us constructive.
The company guided its strategy of continuing to focus on value creation over FY25-30E.
In the auto segment, with its customer focus and technology innovation, the company expects to capitalise on its market share dominance. The farm equipment segment is well-positioned to drive farm mechanisation.
The company will also focus on unlocking the full potential of its finance arm and scaling up its growth gems.
Varun Beverages | Previous close: ₹482.95 | Fair value: ₹550 | Upside potential: 14%
Chouhan highlighted that Varun Beverages (VBL) is PepsiCo's second-largest franchisee (outside the US). The company produces and distributes -carbonated soft drinks (CSDs) - 70%. Non-carbonated beverages (NCB) 10% and packaged water 20%.
PepsiCo offers brand support, important raw materials like concentrates, R&D and advertising and Promotion.
"VBL announced three new growth initiatives: (1) an exclusive distribution partnership with Carlsberg for beer in select Southern African countries, (2) plans to enter the Indian Alcobev market, and (3) a foray into Kenya's beverages segment," said Chouhan.
Sagility | Previous close: ₹52.62 | Fair value: ₹59 | Upside potential: 12%
Chouhan underscored that Sagility is a pure-play healthcare BPO services provider, primarily working with US healthcare payers.
The company has deep relationships with large nationwide payers and has scaled the accounts at a healthy rate, aided by a broad suite of offerings and efficient delivery.
Cost pressures impacting the client might not only have some near-term impact on commercials, but also provide an opportunity for increased outsourcing of new processes.
"We believe pure-play BPO services companies can outperform broader IT services peers during periods of weak discretionary spending," said Chouhan.
Infosys | Previous close: ₹1,655.55 | Fair value: ₹1,800 | Upside potential: 9%
Chouhan highlighted that Infosys is a leading global company that provides digital services and consulting to help businesses transform and grow in the modern world.
The company has more than 320,000 employees working together to help people, companies, and communities reach their full potential.
"We believe Infosys is executing well and is a key pick among incumbents. Infosys has done relatively well despite challenges. We believe the company can be a beneficiary of AI in the medium term, though there can be headwinds in the near term from revenue deflation," said Chouhan.
Chouhan believes Infosys' growth will accelerate as discretionary spending improves and competitive intensity in cost take-out deals and renewals normalises, although there is a lack of visibility for this scenario now.
source: mint
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of the expert. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
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