NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
Motilal Oswal remains selective in the capital goods and defence sector and continues to favor companies with strong execution capabilities, order book visibility, and exposure to high-growth segments such as transmission, defense, and data centers.
According to Motilal Oswal capital goods sector has been largely resilient amid the current turmoil induced by the Middle East war. The focus will continue to be on capital goods and defense, with an increasing need to invest in defense, alternative energy sources such as renewables and transmission, and the development of a domestic ecosystem to reduce dependence on other countries.
Some uncertainties remain if the current war continues for an extended period, affecting the existing order book in the GCC region, along with higher raw material costs and elevated freight expenses. However, the sector benefits from strong demand tailwinds, which can facilitate easier cost pass-through.
For Q4 FY26, the brokerage expects the impact of the ongoing conflict in the Middle East to be limited, with execution growth of 12% YoY, fueled by a strong order book.
Going forward, Motilal Oswal will monitor ongoing war out come, both government and private capex due to a spike in crude prices, as well as the movement in commodity prices, which have been rising over the last few quarters.
Moving ahead, the brokerage remain optimistic about-
- transmission spending, including HVDCs, which will benefit players on both the EPC and product sides,
- defence spending, which will benefit both domestic PSUs and private players,
- data center spending, and
- EMS, where valuations have dipped, and the government is implementing numerous initiatives to accelerate value addition in India.
For Q4 FY26, we estimate our coverage companies to report a revenue/PAT of ~+12%/-6% YoY along with a flat Ebitda.
Motilla Oswal reiterates its positive stance on L&T/Cummins India / Siemens Energy in the large-cap space, and Kirloskar Oil Engines /Kalpataru Projects International in the mid-cap and small-cap segments.
In the defence sector, Bharat Electronics remains Motilal Oswal's top pick.
Click on the attachment to read the full report:
ALSO READ: BEL, HAL, Mazagon Dock And More: Nirmal Bang Raises Target Prices Over Strong Defence Sector Outlook
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
