Stock Picks Today: ITC Hotels, Tata Consumer, Paytm, Sona BLW, And More On Brokerages' Radar

Brokerages have highlighted opportunities across hospitality, FMCG, real estate, pharma, fintech, telecom, consumer services, capital goods and consumer durables sector issuing fresh calls on ITC Hotels, Tata Consumer Products, One 97 Communications, Sona BLW, Urban Company, PB Fintech, Ather Energy, Mankind Pharma, KEI Industries, Aditya Birla Real Estate, Sheela Foam, Bharti Hexacom, Vodafone Idea while also sharing their outlook on auto and defence sector.

Jefferies on ITC Hotels

• Maintain Buy; Hike TP to Rs 220 from Rs 210
• Sharp Beat, Mirroring Strong Sector Trends
• RevPAR rose 21%, mirroring strong sector trends, while mgmt fees grew 25% YoY
• Targets 10% key CAGR over FY26-31
• Raise EBITDA by ~3-5%; Attractive Valuations.

Investec on ITC Hotels

• Maintain Buy with TP of Rs 201
• RevPAR gains and margin expansion drive earnings beat
• Strong pricing and occupancy gains drive growth
• Operating leverage supports earnings beat

Jefferies on Tata Consumer

• Maintain Buy; Cut TP to Rs 1250 from Rs 1450
• Growth Portfolio Riding the quick commerce Wave
• Preferred Staple Picks
• Q2 was ahead despite inflationary pressures in tea/salt
• Product price hikes should help ahead
• International saw a revenue decline but saw margin expansion
• FY27 guidance of 50-70bps YoY EBITDA margin expansion stays.

Citi on Tata Consumer

• Maintain Buy; Cut TP to Rs 1225 from Rs 1400
• Growth Momentum Sustained; Sequential Margin Recovery Ahead
• See a clearer margin recovery path through H2
• Pricing actions across multiple categories  are yet to flow through fully
• This should help mitigate India margin pressures
• Stronger international and non-branded profitability provide further support at the consolidated level
• Estimate 50 bps of EBITDA margin expansion in H2.

GS on Tata Consumer

• Maintain Buy; Cut TP to Rs 1325 from Rs 1440
• Strong double digit volume growth with high teens EBITDA growth in a tough environment
• India business: Double digit volume growth and 17% revenue growth, pricing to significantly accelerate in H2
• ‘Growth' businesses deliver 40% growth driven by Sampann and RTD
• Capital Foods and Organic India domestic growth at 24%, exports impacted due to shipping delays
• Salt continues to deliver strong growth, price increases to further accelerate revenue growth in H2
• Tea muted, but likely to see recovery in H2

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Jefferies on Sona BLW

• Maintain Buy; Hike TP to Rs 950 from Rs 900
• Q2 Beat and Good Order Traction
• Secured new orders across differentials, radar sensors and motors & motor controllers
• Recent partnership with Denso and entry into robotics & physical AI has also opened up big opportunities
• Valuation is rich, but multiples should sustain given strong engineering capabilities and growth potential.

Kotak Neo on Sona BLW

• Maintain Sell; Hike TP to Rs 700 from Rs 675
• Healthy topline performance; Q2 EBITDA 9.5% above expectations
• Sona Comstar 2.0 outlines the next phase of growth
• Partnership with DENSO across 2W/3W and 4W/CV EV and hybrid powertrains
• Valuation remains expensive, which drives SELL rating

Citi on Sona BLW

• Maintain Buy; Hike TP to Rs 960 from Rs 830
• Strong Beat Driven By Healthy Revenue Growth
• Demand Outlook Robust But Cost Headwinds Persist
• Order book trends and product-commercialisation trends are healthy
• Margins are likely to remain under pressure given severe material cost inflation, increase in freight rates, and mix shift towards 2W traction motors

GS on Sona BLW

• Maintain Neutral; Hike TP to Rs 860 from Rs 855
• Q2 beat: EV traction + suspension motors to lead growth H2 growth
• See improving momentum in the EV traction motor and suspension motor business
• Although this comes at a more modest margin

BofA on Urban Company

• Maintain Underperform with TP of Rs 150
• Focusing on right levers; Traction strong across segments
• Steady Core business, InstaHelp burn may be high in near term
• InstaHelp to remain in deliberate burn to win the category
• India core: Flywheel intact; Salon Now opens a use case
• In planned AC foray, the company would remain capex light & asset light
• This is in partnership with Amber, in addition to Native water purifier.

UBS on Urban Company

• Maintain Buy with TP of Rs 180
• Densification breeds a step change in growth trajectory
• Conclusion from Analyst Day: See upside risk to Rs 1000 cr EBITDA guidance by FY31
• Operating leverage is coming through despite higher marketing investments
• Fundraise provides strategic flexibility to pursue inorganic opportunities over next 2-3 years
• Fundraise is building relative balance sheet strength while signalling willingness to compete aggressively in InstaHelp
• Current cash balance is not expected to come under stress through the expected Q3FY28 breakeven.

GS on Urban Company

• Maintain Neutral with TP of Rs 130
• Elevated growth with an intact path to profitability
• Could continue to grow NTV higher than its guided 20%+ in the core business, with even stronger visibility on margins
• Core business moats continue to get stronger, with improving densification and partner utilisation driving accelerating user growth
• Foray into Air Conditioners is unlikely to be material to capex or alter Native's margin trajectory
• Large part of InstaHelp investment is towards marketbuild-out, which will drop off in a few quarters
• Fundraise is likely to be deployed either towards M&A or to keep buffer if Instahelp competition becomes more intense
• Urban Company is unlikely to enter new product categories or geographies.

Jefferies on Mankind Pharma

• Maintain Buy; Cut TP to Rs 2900 from Rs 3220
• No Longer Waiting for Godot
• Q2 results beat; strong Q2 was driven by robust domestic growth and solid export momentum
• This resulted in gross margin gains and operating leverage
• Domestic formulations grew 16% YoY, finally outpacing industry growth
• Muted consumer healthcare growth was the only weak point in Q2
• An improving growth outlook drives 3% Ebitda increase for FY27-29.

Kotak Neo on Mankind Pharma

• Maintain Buy with TP of Rs 3035
• Organic growth shifts into a higher gear
• From 10% YoY in Q1, organic domestic growth accelerates to 14%+ YoY in Q2
• BSV maintains strong momentum; bake in 20% sales CAGR over FY26-29

Jefferies on Paytm

• Maintain Buy with TP of Rs 2150
• Q2: Momentum Stays Strong; MDR To Aid Profit & Investments
• Sharp rise in Ebitda margin to 10% led by efficiencies
• PBT was 17% above est., but PAT (pre-exceptional) was in line due to higher taxes
• Rev growth is led by financial services (loan distribution, investments)
• UPI-MDR will start post-Diwali & mgt sees 2.5bps on GMV as revenues
• See strong growth continuing & stays in 25% Cagr Club

Citi on Paytm

• Maintain Buy; Hike TP to Rs 1940 from Rs 1560
• Solid Growth and Margins Uptick Ahead of MDR Slingshot
• Seeing growth acceleration in financial services and improvement in net payment margins even ex-UPI
• Upping investments in tech (AI), marketing and distribution (MTU acquisition, on-ground sales-fleet)
• EBITDA beat estimates owing to higher share of financial services revenue.

GS on Paytm

• Maintain Buy; Cut TP to Rs 2010 from Rs 2070
• Q2 above expectation
• Strong growth and market share momentum with improving margin
• Underlying market share, revenue growth and margin momentum for the business remain strong, a trend we expect to continue
• Estimate the recently announced UPI MDR to drive up to 40% higher EBITDA for Paytm
• Believe this is not fully reflected in the current share price
• See optionalities to Paytm's earnings and multiples from scale up of postpaid, a potential relaunch of wallet
• Next deadline for implementation of a UPI market share cap is Dec ‘26, which could be a material event for Paytm

Bernstein on Paytm

• Maintain Outperform with TP of Rs 2200
• Strong topline momentum offsets higher costs
• Financial services momentum remains strong
• Net payment margin improves
• Consumer engagement improving
• Device additions stay strong
• Marketing revenue finally sees an uptick.

Nomura on Ather Energy

• Maintain Buy; Hike TP to Rs 2070 from Rs 1926
• Stronger growth visibility with Konarc; reaffirm as top 2W pick
• Q2 ASPs and margins beat consensus
• Stronger bookings a key positive
• Drivers for EV inflection are in place
• Future stock returns are likely to increasingly depend on the EV salience of OEMs

HSBC on Ather Energy

• Maintain Buy; Hike TP to Rs 1800 from Rs 1600
• Q2 – Another positive surprise
• Surprise EBITDA break-even despite demanding commodity headwinds
• This operational resilience should further raise market confidence in Ather's ability to scale in the long-term
• Near-term risk is muted response to Konarc
• Now expect PAT breakeven in FY27. 

HSBC on PB Fintech

• Maintain Hold with TP of Rs 1150
• Key debates on the stock revolve around its ability to grow while rationalising costs, margin outlook, and what is priced in
• Given the significant variation in the potential impact of regulatory outcomes and its own initiatives, we look at different scenarios
• See downside risks in fewer scenarios, but upside catalyst will depend on execution clarity

GS on Defense

• Approved proposals worth Rs 2.12 lakh cr for all the three forces
• Focus on combat equipment for both Army and Navy
• Proposals related to Light multi-role helicopters likely to aid Hindustan Aeronautics
• DPSUs such as Hindustan Aeronautics, BEL, Mazagon Dock Shipbuilders and BEML could be positioned to benefit from the proposals approved
• Of the current Acceptance of Necessity, 82% of the procurement to be made from within the Indian Industry
• This benefits the entire India defense ecosystem
   

Kotak Neo on Defence

• Rs 2.1 lakh cr of approvals reflect a shift to unmanned and air-defense capabilities
• ~82% of the proposed procurement value is earmarked for domestic industry
• Marks the largest DAC approval of FY27 so far and nearly doubles FYTD Acceptance of Necessity to Rs 3.7 lakh cr
• Unlike the land-mobility-heavy September package, this tranche is skewed toward unmanned systems, counter-UAS, short-range air defense and helicopters, alongside major indigenous naval platforms
• BEL has the widest multi-item exposure
• Hindustan Aeronautics gains from two helicopter programs
• Bharat Dynamics from VSHORADS and IAF weapons, and the drone ecosystem
• Order accrual from this tranche will largely fall in FY2028-30E. 

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Citi on Bharti Hexacom

• Upgrade to Buy from Neutral; Hike TP to Rs 1870 from Rs 1700
• Superior growth warrants premium valuation
• A cleaner way to play India telecom growth
• Gov't stake sale an overhang, but also a potential clearing event
• Shift preference to Hexacom over Airtel among the telcos

Jefferies on Vodafone Idea

• Maintain Buy; Cut TP to Rs 16 from Rs 20
• Attractive risk-reward
• Stock has corrected 23% despite improving subscriber trends
• Ongoing network rollouts, along with tariff hikes, should position VodaIdea well to deliver 11%/25% CAGRs in revenue/EBITDA over FY26-29
• At 21x EV/cash EBITDA, shares trades below 5-yr average multiples
• See 25% potential downside and 143% potential upside in bear and bull scenario.

UBS on Auto

• Festive update: Tractors outperform cars in festive; MHCVs tracking double digit growth
• Festive demand continues to grind lower - 2Ws +11%; cars -9%
• Base gets tougher from now on
•  Channel check points to low single digit decline in tractors so far
•  2W market share: Hero/Bajaj tracking 90bps/80bps decline vs. 110bps gains for TVS
• Cars: M&M market share increases by 240bps.

Investec on Sheela Foam

• Upgrade to Hold from Sell; Cut TP to Rs 625 from Rs 700
• Recent price correction has made valuation more reasonable
• See 20% EPS CAGR over FY27-29
• Bake in conservative revenue growth of 7% CAGR over FY26-29, average EBITDA margin at 9.7%
• Issues - input-cost pressures, demand sensitivity to pricing, downtrading risks and competition from D2C mattresses with lower TDI and polyol content

JPMorgan on KEI Industries

• Upgrade to Overweight from Neutral; Cut TP to Rs 4650 from Rs 5650
• Volume growth pickup ahead
• Risk/reward favorable after margin expectation reset
• Product mix shift could protect margins

Jefferies on AB Real Estate

• Maintain Buy; Cut TP to Rs 1600 from Rs 1880
• Reported strong P&L in Q2 on a project delivery, with non-core asset sale proceeds helping turn the balance sheet nearly net cash
• New project additions have picked up pace, though same will likely get launched from late FY27 onwards
• Management focusing on long term value maximisation
• Delay in Worli launch would impact near term pre-sales even as commercial buildout gains visibility
• Stock trades at 45% NAV discount.

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