Global brokerage house Jefferies has put the spotlight on four stocks across different sectors, handing out Buy calls and projecting attractive upside potential as high as 21% in one case.
From banking to consumer goods, let’s take a look at what Jefferies sees in these names and the rationale behind it –
Jefferies on HDB Financial
According to the brokerage report, HDB Financial Services, a subsidiary of HDFC Bank, has been given a target price of Rs 900. This translates to a nearly 19% upside.
Jefferies believes HDB Financial has built a competitive moat through its diversified portfolio, strong distribution reach, and cost advantages. “We believe the franchise can deliver 18% AUM CAGR, 22% EPS CAGR over FY25-28e with ROE improving to 16% by FY28e from 13% in FY26e (post cap raise),” the brokerage added in its report.
Jefferies also notes that net interest margins (NIMs) are expected to rise as rates ease and loan mix changes. While asset quality has seen pressure with GNPA moving to 2.6% in Q1FY26. the brokerage expects a recovery as activity picks up post-monsoon.
“Consistent delivery on asset quality and returns can narrow the valuation gap,” added the brokerage report.
Jefferies on HDFC Bank
Among the four picks, HDFC Bank gets the most attention with Jefferies setting a target of Rs 2,400. This translates to a potential upside of 21%. The brokerage pointed out that the bank’s strong deposit mobilisation, better loan-to-deposit ratio (LDR) targets, and merger-related synergies as key positives.
The brokerage house in its report noted, “Ability to lower LDR to 95% (from 104% last year) and grow deposits at healthy pace of 16% are key pillars to grow and lower LDR to 85-90% by Mar-27.”
Jefferies also points out that HDFC Bank is successfully cross-selling more products to its customers post-merger, boosting revenues and lending appetite. Furthermore, it noted, “Improvement in growth, stable asset quality & merger synergies should support earnings growth & ROE.”
The bank continues to trade at what Jefferies calls “reasonable valuations” compared with peers, strengthening its case as a top pick.
Jefferies on Nuvama
Jefferies has placed a buy rating on Nuvama Wealth with a target price of Rs 8,300. This implies an upside of around 19%. According to the brokerage report, Nuvama’s strong showing in wealth management and asset services offsets some challenges in investment banking.
“Both verticals of the WM segment are ramping well, with rises of 25%/30% in ARR/MPIS AUM and 18-19% growth in operating profit,” added the brokerage house.
Jefferies also noted the risks from competition and possible regulatory action but points to strong retentions in asset services and growing productivity of relationship managers. “The core business is ramping well, and improved productivity of RMs should be a key earnings lever,” added the brokerage report.
With the stock trading at a discount to peers like 360 ONE, Jefferies believes valuations could catch up as growth plays out.
Jefferies on Patanjali Foods
The last stock on Jefferies list is Patanjali Foods, where the brokerage has trimmed its target slightly to Rs 2,000 from Rs 2,050, still offering a 13% upside.
The near-term picture looks mixed, with weaker Q1 performance due to subdued demand in staples and margin pressure in ghee. However, Jefferies notes positives in the company’s HPC (home and personal care) business, which delivered strong profitability.
The brokerage report added, “Oils business should also see a QoQ margin uptick as custom duty impact is largely behind.” Looking ahead, Jefferies expects foods and oils to see gradual recovery with urban demand picking up.
“Recovery in the foods business, both on topline and margins, remains critical to stock performance,” the brokerage added in its report.