Here Are The Top Six Picks For October With Upto 39% Upside Potential Recommended By DRChoksey — Check List

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DRChoksey Report

Rossari Biotech - Potential Upside 39.1%

The upcoming EO capacity and backward integration are expected to enhance cost efficiency and margins, while ongoing expansions at Unitop and Tristar diversify the portfolio into high-growth chemistries. The new Southeast Asia formulation facility strengthens export capabilities, and rising operating leverage, coupled with a robust innovation pipeline, further supports our positive view on the business outlook.

We revise our FY26E/FY27E EPS estimates by +2.0%/-3.3%, respectively, as we factor in improved visibility based on management’s forward guidance for FY26E, while the downward adjustment in FY27E factors in a more gradual margin recovery trajectory than previously anticipated. We have rolled forward our valuation basis to Jun’27 estimates.

We value Rossari Biotech at a 23.0x Jun’27 EPS, implying a target price of Rs 860, supported by strong momentum in HPPC and AHN segments and improving breakeven trajectory in the institutional business.

ITC - Potential Upside 27.4%

We remain optimistic on the medium-term outlook, led by steady momentum across core FMCG categories, increasing premiumization in the cigarette's portfolio, and continued expansion of digital-first and modern trade channels.

ITC is actively investing in portfolio innovation, rural distribution, and sustainable packaging, which are expected to support long-term growth. Despite near-term margin pressures in the FMCG–Others and paperboards, management remains confident in the recovery of the profitability led by moderation in input prices moderates and improvement in operating leverage.

The nicotine derivatives business continued to scale well, positioning ITC to tap into a high-margin global opportunity. The agri business remains a key growth engine, with rising exports and deeper integration into the food's ecosystem.

We expect a recovery in margins across segments from H2FY26E onwards, led by easing cost pressures and favorable product mix.

We have revised our FY26E/27E EPS estimates by -4.2%/-4.5%, as we factor in weaker Ebitda margins on account of higher input inflation.

We value ITC based on SOTP valuation methodology, with Cigarette business at 14.0x FY27E EV/Ebitda, agri, business at 8.0x FY27E EV/Ebitda, Paper business at 4.5.0x FY27E EV/Ebitda, FMCG at 8.0x FY27E EV/Revenue, and its stake in ITC Hotels at Rs 13.0 per share (reflecting a 20.0% hold-co discount), implying a target price of Rs 512.

Bandhan Bank - Potential Upside 22.2%

Bandhan Bank is undergoing a strategic transition aimed at building a more diversified, stable, and resilient business model. Q1 FY26 performance stood below our estimates across the board, led by calibrated decline in gross advances and poor profitability driven by reducing over-reliance on the EEB segment, and enhancing asset quality through disciplined underwriting and risk controls.

Bank continued to recalibrate its operations by deepening its focus on secured retail and wholesale lending, and expects improved traction across core lending markets, especially in geographies where credit discipline is gradually being restored.

On the liabilities front, the Bank has made significant progress in mobilizing granular retail deposits by enabling its extensive branch network to source retail term deposits and improve deposit mix. The “One Bandhan” initiative and the digitalization of customer touchpoints have further strengthened its distribution architecture and customer engagement.

We have revised our FY26E/FY27E adjusted book value per share estimates by -1.8%/-2.1%, respectively, factoring in elevated technical write-offs, persistent stress in the EEB portfolio, and anticipated near-term pressure on NIMs.

We value Bandhan Bank at 1.1x Mar’27 ABVPS, implying a target price of Rs 198 per share.

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