Stock Picks Today: Havells, Jubilant Food, Nykaa, Varun Beverages, Bajaj Finance, And More On Brokerages' Radar

Brokerages issued fresh views on Havells, Jubilant Foods, Varun Beverages, Nykaa, Bajaj Finance, LG India, Tata Capital, Radico Khaitan alongside commentary on Indian IT sector and consumer durables.

Citi on Havells

• Maintain Buy with TP of Rs 1500.
• Room air conditioner demand has been mixed over the last 2-3 months.
• Fans as a category is less summer-sensitive than AC; non-fan categories are doing better.
• Stayed disciplined on Lloyd pricing/discounts despite competition, preferring margin discipline.
• Cables & Wires growth continues to remain strong.
• Stepping up R&D/innovation and energy-transition investments.
• Aims to deliver mid-teens revenue growth in the medium-term and expects profit growth to outpace revenue growth.

Citi on Jubilant Food

• Maintain Buy with TP of Rs 650.
• Domino's India LFL should remain in the 5–7% medium-term range.
• Q4 deceleration was driven by high base, lower free-delivery threshold and weaker dine-in/takeaway, rather than demand weakness.
• Management has already taken calibrated pricing actions.
• Dine-in recovery will likely take longer than delivery.
• Margin pressure from cost inflation should be partially offset by pricing/mix actions.
• Management remains confident of 200 bps standalone margin expansion.
• Popeyes continues to show improving economics.

JPMorgan Bajaj Finance

• Maintain Overweight with TP of Rs 1080.
• Strong execution despite macro noise.
• Growth resilient, Asset Quality benign, FY27 NIM guidance intact.
• Growth momentum on the ground remains strong despite macro concerns.
• Asset quality trends remain benign across loan segments with no visible impact from the Middle East conflict.
• Remains confident of delivering on its guidance of a 10-12 bps NIM decline in FY27.

GS on Varun Beverages

• Maintain Buy with TP of Rs 600.
• Alliance with Asahi Group might not move the revenue needle significantly.
• It potentially opens up further avenues to address other white spaces.
• Gives a foothold in the “better-for-you,” fermented/functional dairy beverage space to address the health-conscious consumer shift.
• Gets a differentiated, premium-positioned SKU to layer onto its existing portfolio.
• Potentially looking for a tie-up with Asahi for its Beer business in India at a later stage.
• This alliance could be replicated in International territories like Africa.

GS on Varun Beverages

• Maintain Buy with TP of Rs 600.
• Alliance with Asahi Group might not move the revenue needle significantly.
• It potentially opens up further avenues to address other white spaces.
• Gives a foothold in the “better-for-you,” fermented/functional dairy beverage space to address the health-conscious consumer shift.
• Gets a differentiated, premium-positioned SKU to layer onto its existing portfolio.
• Potentially looking for a tie-up with Asahi for its Beer business in India at a later stage.
• This alliance could be replicated in International territories like Africa.

MS on IT Sector

• Read-across from Accenture Q3: tough macro climate could continue in Q2.
• Implied Q4 growth outlook were below estimate.
• Incremental data points alluded to delayed decision-making and impact of Middle East.

What's relevant for Indian IT:

• Indirect impact of geopolitical conflict felt across different geographies/verticals.
• Likelihood of impact of uncertainty percolating into Q2 as well.
• Risks to FY27 guidance range from Indian IT companies.
• Impact could be different across players.

Jefferies on IT Sector

• Revised revenue growth guidance suggests further growth moderation.
• This may lead to cuts to consensus expectations.
• Soft growth on a low base is likely to raise concerns on longer term growth outlook and may drive further derating.
• IT firms may have to look for new growth drivers (mid-market, M&A) to offset softness in traditional services growth.
• Post Accenture's 18% fall, Top-5 IT is trading at 70% premium to Accenture.
• This poses further downside risks to multiples of Indian IT firms.

Kotak Securities on IT Sector

• Read-through for Indian IT—no positive cues.
• Accenture's results provide no solace to a sector beleaguered by multiple headwinds.
• Risk of higher AI deflation from sharp GenAI capability increase in software tasks.
• See incremental headwinds to growth led by the Middle East conflict.
• Indirect impact focused more on discretionary spending and product vertical.
• Infosys can be a tad more vulnerable than Tier 1 peers to indirect impact.
• Possibility of the lack of sufficiently managed services opportunities in the market.
• Growth moderation in the existing services market may not recover soon.

HSBC on IT Sectors

• Guidance cut signals continued soft demand environment, which is a negative read across for Indian IT.
• However, softness is driven by the Middle East disruptions rather than AI-led productivity pressures.
• Indian IT services companies continue to lack short-term triggers while their valuations seem close to trough.

Nomura on Tata Capital

• Maintain Buy with TP of Rs 400.
• Getting through the recent crisis decently well, except for pressure on cost of funds.
• Asset quality and credit underwriting tightening.
• Motor finance book: progressing as planned with possible delay of a quarter.
• Margin expansion from both new and old; 10-20 bps opex ratio improvement.

Jefferies on Nykaa

• Maintain Buy with TP of Rs 350.
• Beautiful and Fashionable Platform.
• In an impressive analyst meet, mgmt outlined an ambitious but credible glide path.
• Beauty to compound via omnichannel, ads, & faster fulfilment.
• Wellness to add premium, higher margin adjacencies.
• Fashion to ride on curation & brand expansion, with high single digit margins in 4-years.
• Own brands are a key growth pillar, with a rising off platform mix.
• The AI lever is central to the model.

Macquarie on Nykaa

• Maintain Underperform with TP of Rs 210.
• Stronger-than-expected target of 4-5x Ebitda over FY26-30E.
• Ebitda guidance suggests sharp beauty margin expansion.
• Remain concerned about acceleration in rest-of-beauty GMV growth momentum implied in the guidance.
• The scale constraints along with hurdles in expanding Dot & Key brand footprint in offline channels;
• See difficulty in replicating Dot & Key success.

JPMorgan on Nykaa

• Maintain Neutral with TP of Rs 270.
• Beauty moat deepens; fashion flywheel builds.
• Nykaa's focus remains on brand trust, superior assortment and disciplined execution.
• EBITDA margins are expected to expand to low-to-mid-teens by FY30.
• Ambitious medium-term growth aspiration stated by the company will support premium stock multiples.

MS on Nykaa

• Maintain Overweight; Hike TP to Rs 321 from Rs 286.
• Management sounded optimistic on the premium beauty and fashion growth opportunity.
• Company is targeting revenue/GMV growth of 25% or higher across segments, with improving profitability.
• Positive management commentary and strong performance trends in recent quarters should drive to an upgrade in consensus earnings estimates.

Citi on LG India

• Maintain Buy with TP of Rs 1800.
• Category demand is broadly healthy across ACs, washing machines, and TVs, while refrigerators remain relatively slower.
• RAC sell-out was very strong in April and May.
• LG has taken price hikes ahead of most peers.
• Remains focused on protecting margins while broadly maintaining market share.
• Premiumization remains a key advantage.

Citi on Radico Khaitan

• State level regulatory environment is becoming more supportive.
• Reforms in states such as Uttar Pradesh, Karnataka, Andhra Pradesh, and Rajasthan expected to aid premiumisation and category growth.
• Premium brands and white spirits remain the key growth drivers.
• Growth supported by strong traction in recent premium launches, the on-trade channel, and flavourled vodka expansion.
• Management expects further margin expansion, driven by an improved mix, gross margin expansion, and a stable raw material cost outlook.

JPMorgan on Amber

• Maintain Neutral with TP of Rs 7,650.
• Expanding total addressable market at cost of margins.
• Believe the rationale to increasingly outsource could be localisation.
• Mobile manufacturing typically operates at lower 3% Ebitda margins.
• Await for further details from Amber over due course.

BofA on Consumer Durables

• Mixed trends in demand across regions.
• Another round of price hikes for ACs expected.
• Topline to be driven by price hikes, margins to suffer.
• Reiterate underperform on Voltas and Havells.

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