Are you thinking about what stocks to invest in now? The global brokerage firm, Nomura, has identified three stocks with strong upside potential. It has rated Tata Consumer Products, TVS Motors, and Aditya Birla Real Estate ‘Buy’ and sees as much as 95% upside in select stocks.
Here’s a detailed analysis of Nomura’s investment rationale-
Nomura on Tata Consumer Products
Nomura has raised the target price on Tata Consumer Products to Rs 1,450 from Rs 1,350, implying a list of more than 22% from the current market price. The brokerage kept its ‘Buy’ rating unchanged on the stock. Pricing across categories has completely anniversarised. Tea volumes and sales grew 3% YoY in Q3 FY26, which was in line with the estimate of 3.5%, despite a high base on a yearly basis.
“We value Tata Consumer Products on DCF (discounted cash flow), assuming a risk-free rate of 6.75%, risk premium of 5%, beta of 0.7, weighted average cost of capital 10.3% and terminal growth rate of 6% (all metrics unchanged),” said the brokerage.
Going forward, the brokerage expects mid-single-digit volume growth in Tea to sustain. With tea prices going upprice changes will be minimal from hereon, as it has low-priced inventory.
“We increase FY27 and FY28 EPS by 3.5% and 4.5%, respectively, as we factor in better margins and forecast 10 for sales, 14% for EBITDA, and 17% for EPS CAGRs over FY26-28,” said Nomura.
Nomura on TVS Motors
Nomura raised the target price on TVS Motor Company as well. The brokerage has set the new price target of Rs 4,159 from Rs 3,970. It has maintained the ‘Buy’ call on the automobile stock with an upside potential of xx%.
The success of recent electric two-wheeler and three-wheeler launches and premium Norton motorcycles could drive further upside. The brokerage house raised volume estimates by 4-5% over FY26-FY28.
It is expected that the two-wheeler industry will grow 8% YoY in FY26-FY27 and TVS Motors will outperform the industry average (19% and 9%), led by rising scooter share and new launches. Exports are likely to grow at 33% and 10% in FY26 and FY27, respectively.
We estimate FY26, FY27, and FY28 EBITDA margins at 13%, 13.8%, and 14.7%, respectively (against 12.9%, 14.2%, and 14.9% previously) to factor in some commodity cost pressure.
“We had expected a beat in Q3 FY26 and still expect TVS’s margins to keep expanding on weaker INR and operating leverage as its scale approaches that of larger peers such as Hero MotoCorp and Bajaj Auto.
Nomura on Aditya Birla Real Estate
Nomura maintained its ‘Buy’ rating on Aditya Birla Real Estate, with a retained target price of Rs 2,550. This implies an upside of over 95% from the current market price. A day back, the company reported its quarterly results for the third quarter of the current financial year.
While its Q3 FY26 presales and collections were strong at Rs 2,530 crore, which was up 184% sequentially, and Rs 1,290 crore, up 157% YoY. The company cut its FY26 project launch guidance from Rs 14,000 crore to Rs 8,900 crore. Aditya Birla Real Estate’s share price has corrected by 31% over the past year, as against the Nifty 50, which rose 11% during the same time frame. The stock is currently trading at a 20% discount to net asset value.
“We believe that at this valuation, the stock has likely priced in most of the negatives,” said Nomura. The company recorded an EBITDA loss for Q3 FY26. So, looking at its P&L is less relevant now, as ABREL has Rs 15,000-16,000 crore of revenues to be potentially booked in the future, said the brokerage.
Overall, the brokerage house has based the rating upgrades on strong earnings and a healthy order pipeline.
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.