What do a snack maker, a consumer products company and a hotel chain have in common? All three have landed on Motilal Oswal’s radar, with the brokerage seeing potential upside of 30% to 43% in their stocks.

Motilal Oswal has retained its ‘Buy’ rating on Gopal Snacks, Cello World and Lemon Tree Hotels. But the reasons behind the calls vary. One is expanding its distribution network, another is waiting for demand and capacity utilisation to improve, while the third is banking on hotel expansion and rising management-fee income.

What is driving the brokerage’s view on these three stocks? Let’s take a look –

Motilal Oswal on Gopal Snacks: Distribution expansion takes centre stage

For Gopal Snacks, Motilal Oswal has set a target price of Rs 390. This implies an upside of 43%.

The company’s revenue increased 31.1% year-on-year (YoY) to Rs 420 crore in the June quarter. Growth was led by wafers and gathiya, while Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) rose 107% YoY to Rs 31.5 crore.

The brokerage believes the recently operational Rajkot plant could help reduce manufacturing and transportation costs. Gopal Snacks also added 54 distributors during the quarter.

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Its retail reach currently stands at around 5.2-5.5 lakh outlets, with a target of reaching 6 lakh outlets by the end of financial year 2027.

Motilal Oswal expects revenue, EBITDA and adjusted profit after tax (PAT) to grow at compound annual growth rates (CAGR) of 17%, 40% and 87%, respectively, between FY26 and FY28.

The brokerage said, “We expect GSL to benefit from distribution expansion in non-core markets and commissioning of its Rajkot manufacturing facility, offering multi-quarter revenue growth visibility with strong underlying demand.”

Motilal Oswal on Cello World: Can demand recovery change the picture?

Cello World offers a 33% upside, according to Motilal Oswal, which has set a target price of Rs 480 and a ‘Buy’ rating.

The June quarter was more challenging. EBITDA declined 9% YoY as higher input costs, subdued consumer demand and lower utilisation at its steel bottle facility affected performance.

However, price increases across categories helped gross margins improve sequentially from around 47% to 52%.

The brokerage expects demand to gradually recover from the second quarter of FY27. Better utilisation of steelware and glassware facilities could then provide a lift to revenue and profitability.

Motilal Oswal said, “We anticipate a gradual recovery from Q2FY27 onwards.”

It expects revenue, EBITDA and PAT to grow at CAGRs of 10%, 19% and 16% between FY26 and FY28.

Motilal Oswal on Lemon Tree Hotels: Expansion is the next trigger

Lemon Tree Hotels has a target price of Rs 140, implying around 30% upside and a ‘Buy’ rating. 

The hotel chain reported 9% YoY revenue growth in the June quarter. Management fees increased 42%, while food and beverage revenue rose 30%. Occupancy improved by 320 basis points to 75.7%.

The brokerage expects growth to be supported by Lemon Tree’s expansion pipeline, including around 3,300 rooms through Fleur by FY30.

It also expects higher management-fee income and premiumisation through the Aurika brand to support the business.

Motilal Oswal said, “We expect Lemon Tree Hotels to show healthy growth, primarily led by aggressive expansion through Fleur.”

The brokerage forecasts revenue, EBITDA and adjusted PAT CAGRs of 9%, 13% and 22% over FY26-FY28.

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What investors should watch

The three ‘Buy’ calls are based on different triggers. Gopal Snacks is focused on distribution and manufacturing efficiencies. Cello World needs demand recovery and better capacity utilisation. Lemon Tree Hotels is banking on expansion and higher management income.

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