Brokerages Pick 10 Stocks Amid Market Correction

BROKERAGE-REPORTS
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AuthorRiya Kapoor|Published at:
Brokerages Pick 10 Stocks Amid Market Correction
Overview

Following a 2% market correction this week, prominent brokerage firms have revised estimates and highlighted ten stocks across banking, finance, auto, and consumer sectors. Firms like JM Financial, Motilal Oswal, Goldman Sachs, and Nuvama Wealth Management have issued new recommendations, focusing on companies showing resilience or clear catalysts despite broader market hesitancy. Key updates include Zomato's Blinkit achieving breakeven ahead of schedule and Bandhan Bank's improving asset quality.

1. THE SEAMLESS LINK (Flow Rule):
The market experienced a 2% correction this week, prompting leading brokerage houses to re-evaluate their estimates and identify potential investment opportunities. Firms such as Motilal Oswal, Goldman Sachs, Nuvama Wealth Management, and JM Financial have released updated recommendations, focusing on ten stocks across banking, finance, auto, and consumer sectors.

2. THE STRUCTURE (The 'Smart Investor' Analysis):

Market Sentiment and Brokerage Activity

A 2% market correction cast a shadow over trading floors this week. Against this backdrop of fluctuating investor sentiment, major financial research houses are actively recalibrating their outlooks. This proactive stance signals a search for value amidst prevailing caution.

Sectoral Analysis and Stock Catalysts

This period of market recalibration has seen brokerages pinpoint specific stocks driven by distinct performance narratives and future prospects.

  • Zomato (formerly Eternal): JM Financial maintains a ‘Buy’ rating with a target of ₹400, projecting a 54.1% upside. This optimism stems from Blinkit achieving adjusted EBITDA breakeven, occurring two quarters ahead of projections, supported by a 121% year-on-year surge in food delivery net order value.
  • Bandhan Bank: Motilal Oswal reiterates a ‘Buy’ recommendation, setting a ₹175 target price for a potential 23% gain. The bank's Q3 FY26 results showed a 83.9% sequential jump in net profit to ₹205.99 crore, alongside a reduction in Gross Non-Performing Assets (GNPA) to 3.3% from 5% in the previous quarter. The bank, which has navigated a protracted NPA cycle, saw its market capitalization near ₹24,000 crore, trading around ₹149 per share.
  • United Spirits: Nuvama keeps a ‘Buy’ rating but adjusts the target price to ₹1,660, implying a 25.3% upside. Performance was impacted by a 3.2% year-on-year volume decline, attributed to adverse policy changes in Maharashtra and a stocking effect in Andhra Pradesh. Stable margins are anticipated despite inflation in Scotch whisky costs.
  • Supreme Industries: Motilal Oswal maintains its ‘Buy’ rating with a ₹4,200 target, suggesting over 25% upside. The company reported a 7% EBITDA growth in Q3 FY26, breaking a five-quarter decline, driven by 13% year-on-year volume expansion. However, margins remained flat due to volatile PVC pricing, with the stock down 17% in the past three months. Its market cap is approximately ₹44,000 crore, with a P/E ratio between 46.5 and 58.5. Shares traded between ₹3,348.70 and ₹3,455.00 as of January 22, 2026.
  • Havells India: Goldman Sachs retains a ‘Buy’ rating and a ₹1,880 target price, forecasting a 30.1% potential upside. The firm sees stabilizing demand, an improving business mix, and the potential end of an earnings downgrade cycle. Q3 FY26 revenue rose 14% year-on-year, accelerating to 18% when excluding the Lloyd business.
  • IndiGo: Motilal Oswal reiterates its ‘Buy’ call, setting a ₹6,100 target price for nearly 24% upside. The airline is entering a phase of moderated capacity growth, expected to foster stability despite near-term margin pressures. Q3 FY26 revenue reached a record ₹23,471.90 crore, an increase of 6.16% year-on-year, though profit margins compressed. Competitors indicate reluctance to fill surrendered slots due to the short-term nature of the offer.
  • JSW Infrastructure: Nuvama maintains a ‘Buy’ rating with a ₹360 target price, implying a 40% upside. The company reported in-line Q3 FY26 results, with operational revenue, EBITDA, and PAT growing 14%, 10%, and 9% year-on-year, respectively.
  • Indian Hotels: Motilal Oswal reaffirms a ‘Buy’ rating and a ₹850 target price, projecting around 30% upside, citing healthy outlooks from core and new business segments. The company's market capitalization stands at approximately ₹91,797 crore. A limitation noted is its high P/E ratio, around 50.70-62.99. Shares were trading around ₹646.
  • LTIMindtree: Motilal Oswal retains a ‘Buy’ rating with a ₹7,900 target price for a 23% upside. While the IT sector faced a combined impact of approximately ₹5,400 crore from new labor codes in Q3 FY26, LTIMindtree's reported $1.2 billion in revenue, up 2.4% quarter-on-quarter in constant currency. Deal ramp-ups and stabilization in large accounts are expected to support Q4 momentum.

Brokerage Confidence and Sectoral Trends

These recommendations reflect brokerage confidence in specific growth narratives, from Zomato's delivery efficiency to Bandhan Bank's asset quality improvements and the IT sector's resilience amidst regulatory adjustments. However, concerns such as United Spirits' policy headwinds, Supreme Industries' margin pressures, and IndiGo's cost management persist. Indian Hotels, while poised for growth, faces scrutiny over its valuation.

3. INTERNAL AUDIT LOG:

  • Market correction of 2% this week noted.
  • Brokerage firms included: Motilal Oswal, Goldman Sachs, Nuvama Wealth Management, JM Financial.
  • Stocks analyzed: Zomato (Eternal), Bandhan Bank, United Spirits, Supreme Industries, Havells India, IndiGo, JSW Infrastructure, Indian Hotels, LTIMindtree.
  • Zomato: JM Financial 'Buy', TP ₹400 (54.1% upside), Blinkit EBITDA breakeven, Net Order Value +121% YoY.
  • Bandhan Bank: Motilal Oswal 'Buy', TP ₹175 (23% upside), Market Cap ~₹24,000 Cr, P/E ~7.73-23.8, Q3 FY26 Net Profit ₹205.59 Cr (+83.9% QoQ), GNPA 3.3%. Current stock price around ₹149.
  • United Spirits: Nuvama 'Buy', TP ₹1,660 (25.3% upside), Volume -3.2% YoY due to policy/retail fill, stable margins.
  • Supreme Industries: Motilal Oswal 'Buy', TP ₹4,200 (>25% upside), Market Cap ~₹44,000 Cr, P/E ~46.5-58.5, Q3 FY26 EBITDA +7% YoY, Volume +13% YoY, flat margins due to PVC, stock -17% in 3 months. Current trading range ₹3,348.70 - ₹3,455.00.
  • Havells India: Goldman Sachs 'Buy', TP ₹1,880 (30.1% upside), Q3 FY26 Revenue +14% YoY (+18% ex-Lloyd).
  • IndiGo: Motilal Oswal 'Buy', TP ₹6,100 (~24% upside), Q3 FY26 Revenue ₹23,471.90 Cr (+6.16% YoY), net profit ₹549.80 Cr, margin compression, competitor reluctance for slots.
  • JSW Infrastructure: Nuvama 'Buy', TP ₹360 (40% upside), Q3 FY26 Revenue +14%, EBITDA +10%, PAT +9% YoY.
  • Indian Hotels: Motilal Oswal 'Buy', TP ₹850 (~30% upside), Market Cap ~₹91,797 Cr, P/E ~50.70-62.99 (high valuation noted), Q3 FY26 PAT +84.22% YoY. Current stock price around ₹646.
  • Added context on IT sector labor code impact.
  • Added context on IndiGo competitor slot reluctance.
  • Noted high valuation for Indian Hotels.
  • Noted PVC price impact on Supreme Industries.
  • Q3 FY26 results were the primary basis for analysis, implying regulatory filings were the source of this data.
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