The markets are taking a breather but that doesn’t mean you cannot look for value buys at the moment. The brokerage firm, Motilal Oswal has reiterated a ‘Buy’ rating on three key stocks, citing strong growth potential and strategic expansions. The brokerage firm believes these stocks are well positioned to benefit from industry tailwinds and long-term expansion plans.
Let’s take a closer look at why Motilal Oswal remains bullish on UltraTech Cement, L&T Finance, and EPL.
Motilal Oswal on UltraTech Cement: Focus on core cement business intact
Motilal Oswal remains optimistic about UltraTech Cement, maintaining its ‘Buy’ recommendation on the stock. While the company is expanding into the cable and wires segment, cement remains its core business. According to the brokerage, UltraTech Cement foray into cable and wires aligns with its existing construction value chain, remains a key highlight.
“UltraTech Cement’s domestic grey cement capacity is expected to reach 182.8 million tonnes per annum (mtpa) by FY25-end, accounting for ~28% of the industry’s capacity. This will further expand to 209 mtpa by FY27,” the brokerage noted its report.
Cement demand in India remains robust, and India’s per capita cement consumption stands at 295 kg, significantly lower than the 500-700 kg seen in Western countries.
On the valuation front, the brokerage expects strong volume growth, improved clinker utilisation, and price hikes to drive earnings. “We estimate UltraTech Cement’s consolidated revenue/EBITDA/PAT CAGR at ~17%/28%/32% over FY25-27,” the brokerage stated, reiterating a target price of Rs 13,700, valuing it at 20x FY27E EV/EBITDA.
Motilal Oswal on L&T Finance: Navigating challenges in the microfinance sector
L&T Finance has also received a ‘Buy’ rating from the brokerage firm, as the company navigated challenges in the microfinance sector. The brokerage noted the stress in the MFI industry due to factors like the Karnataka Ordinance and upcoming regulatory changes but highlighted L&T Finance’s strong asset quality performance.
“While the microfinance stress may linger, L&T Finance is expected to emerge relatively less impacted compared to its peers,” the brokerage noted. The company’s long-term strategy involves reducing MFI loans to 20-22% of its loan mix while leveraging digital partnerships with platforms like Amazon and PhonePe to drive non-MFI retail loan growth.
Looking ahead, Motilal Oswal estimates L&T Finance’s loan book to grow at a CAGR of approx. 21%, with PAT growth at around 22% over FY24-27.
“Beyond the current stress in MFI, the company will continue to deliver an improvement in profitability and RoA expansion,” the report added. The brokerage has set a target price of Rs 170, valuing L&T Finance at 1.4x September 2026E BVPS.
Motilal Oswal on EPL: Entering a new phase with Indorama Ventures
EPL is set to undergo a transformation with Indorama Ventures acquiring a 24.9% stake from Blackstone for Rs 1.9 billion ($221 million). The brokerage sees this partnership as a game-changer, reinforcing EPL’s position in the packaging and sustainable materials industry.
“Indorama Ventures will secure a board seat and bring strategic advantages, including global expertise in PET production and recycling, along with access to an extensive market network,” the brokerage said in its report.
Despite Blackstone’s stake reducing to 26.55%, it remains the largest shareholder, reaffirming its long-term commitment to EPLL. The brokerage remains optimistic about EPLL’s growth potential, expecting a revenue/EBITDA/PAT CAGR of 9%/14%/25% over FY25-27.
“We reiterate our positive outlook, valuing the stock at 16x FY27E EPS, with a target price of Rs 270,” added the brokerage in its report.