The markets have been on a weak footing. If you are wondering what stocks to buy in this situation, the leading brokerage house, Nuvama Institutional Equities, has some options you could explore.
It has issued bullish updates for 3 stocks driven by strong Q3 earnings and future growth outlook. The brokerage firm sees as much as 46% upside potential in one of the stocks.
Here is a detailed analysis of Nuvama’s investment rationale.
Nuvama on Mphasis
Nuvama retained its ‘Buy’ call on the stock, with a target price of Rs 3,400, implying an upside of 21.4%. MphasiS delivered strong deal wins again. Trailing twelve-month deal wins were up 100% YoY in Q3FY26.
However, revenue growth still lags deal wins significantly and needs to pick up to provide higher growth visibility, said the broker.
“We are tweaking FY26 and FY27 EPS by +0.4% and -4.3%, respectively, on a slightly lower growth assumption in FY27,” said Nuvama.
Mphasis reported stable Q3FY26 numbers. Revenue grew 1.5% CC sequentially and 7.4% CC YoY to $451.4 million, beating estimates.
EBIT margin was stable at 15.2%, which came in 10 basis points lower QoQ, in line with estimates. Adjusted PAT was broadly in line. Total contract value was decent at $428 million (-19% QoQ and 22% YoY).
Nuvama on APL Apollo Tubes
Nuvama raised the price target to Rs 2,638 on APL Apollo Tubes from Rs 2,188. The new target price suggests that the stock may rise 34% over the next one year. The brokerage house retained its ‘Buy’ rating.
Nuvama said that given earnings beat and guidance upgrade, it has raised EPS estimates for FY26, FY27, and FY28 by 3%, 7%, and 9%, respectively. Further, the brokerage raised the target valuation to 40x from 36x on strong growth visibility, robust balance sheet, and entry into the margin accretive super-speciality segment.
The company posted strong Q3FY26 results with EBITDA/tonne at Rs 5,145, which was driven by several factors. First, better fixed cost absorption. Second, SG Premium is turning profitable with EBITDA/tonne of Rs 1,500–2,000 per tonne. Lastly, a reduction in freight and power costs.
The firm’s management upgraded volume growth guidance for Q4 FY26, FY27, and FY28 to 20% and EBITDA/tonne guidance to Rs 5,500, earlier it was Rs 4,600–5,000.
Nuvama on Waaree Energies
Nuvama Institutional Equities maintained its ‘Buy’ rating on Waaree Energies, with a target price of Rs 3,867. This implies that the brokerage sees more than 46% lift coming in the stock over the next 12 months.
Nuvama said that the company’s backward and forward integration shall de-risk earnings concentration. The adjacent green businesses, such as inverters, electrolyser facility, GH2 production and BESS capacity, shall provide a mammoth multi-decadal growth opportunity.
In Q3FY26, the company made a Rs 300 crore one-off provision towards the US inquiry. The brokerage said that the company has transitioned to a fully integrated player (Waaree 2.0). The US is a key growth pillar, getting a revenue of Rs 2000 crore from the module production/sales at 275/313MW.
Overall, the rating upgrades are based on the order outlook and overall growth potential. The brokerage reports highlight the opportunities going forward.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.