Stocks to buy for long term: The Indian stock market has been volatile over the last year, with the market benchmark Nifty 50 hovering around the psychological 25,000 mark for most of the trading year, largely due to external factors such as geopolitical tensions, tariff wars and regime changes in key global economies.
Domestic macroeconomic indicators, however, have seen significant improvement, be it the lower inflation, contained fiscal deficit, healthy GDP growth rate and downward sloping interest rate cycle (down 100 bps in CY25) along with RBI’s focus on adequate systemic liquidity.
Indian stock market: Samvat 2082 outlook
According to Pankaj Pandey, the head of research at ICICI Securities, the key near-term triggers for the Indian stock market are the real demand growth across consumer categories in the ongoing festive season, consequent to the GST rate cut and a potential US-India trade deal.
Pandey believes corporate earnings may grow at 12 per cent CAGR over FY25-27E.
“We expect double-digit earnings growth to resume from FY27E onwards, which should ensure healthy equity returns going forward. Our medium to long-term outlook is positive,” said Pandey.
“With improving growth outlook amid greater purchasing power in the hands of consumers through income tax & GST rate cuts as well as government’s relentless focus on increasing manufacturing GDP through policy reforms, we remain positive on markets,” Pandey said.
“With the rest of the asset classes, namely global equities, debt, and precious metals (gold, silver) delivering healthy returns in the recent past, the stage is all set for domestic equities to outperform peers going forward,” he said.
Stock picks for the long term
CreditAccess Grameen | Last traded price: ₹1,388.95 | Target price: ₹1,600
Pandey undercored that CreditAccess Grameen, a leading NBFC-MFI in India, boasts over three decades of experience, managing ₹26,055 crore AUM.
Elevated borrower leverage impacted credit growth (-2.5% in FY25), asset quality (GNPA up 360 bps at nearly 4.8%) and earnings (de-grew 63.2% in FY25), said Pandey.
He believes restricting borrowers’ leverage, creating a provision buffer, and continued traction in the rural economy may stabilise the asset quality trend, thereby resulting in a revival in disbursement.
“We expect a healthy revival in H2FY26, delivering AUM growth of 14-18 per cent in FY26. Anticipating revival in business growth, improvement in collections and return ratios, we maintain a positive view on the company,” said Pandey.
Kaynes Technology India | Last traded price: ₹6,991.80 | Target price: ₹8,900
Pandey pointed out that Kaynes Technology India (Kaynes) is a leading electronics manufacturing services (EMS) company, which integrates electronic circuit boards and other components into final, ready-to-use products/sub-products across sectors such as automotive, industrial, aerospace, railways, medical, and IoT.
Its revenue has grown aggressively at 56.8 per cent CAGR over FY22-25 and is poised for 48.1 per cent CAGR over FY25-28E.
The company is investing over ₹3,300 crore on chip manufacturing and over ₹1,400 crore on PCB manufacturing, which shall be margin accretive and aid long-term business growth.
“With robust growth runway, differentiated capabilities and proven execution, Kaynes is well-placed to benefit from India’s electronics and semiconductor revolution,” said Pandey.
AIA Engineering | Previous close: ₹3,319.65 | Target price: ₹4,060
Pandey said AIA Engineering (AIA) is India’s largest manufacturer and supplier of high chrome wear, corrosion and abrasion resistance castings used in cement, mining and thermal power plants (or mills).
AIA witnessed a tepid business declining 12.7 per cent over FY23-25 due to multiple headwinds, which we believe have bottomed out and will start yielding results from H2FY26E.
The recent order win in Chile and the decision to put greenfield plants in China and Ghana reiterate our thesis.
“We expect revenue, EBITDA, and PAT to grow at 7.3 per cent, 7.3 per cent and 7.5 per cent CAGR over FY25-27E. We recommend a buy rating with a target of ₹4,060 (30 times FY27E EPS),” said Pandey.
Greenlam Industries | Previous close: ₹259 | Target price: ₹300
Pandey underscored that Greenlam Industries has completed greenfield expansion for plywood and chipboard categories, along with brownfield expansion for laminate, incurring nearly ₹1,450 crore capex over the last three years, thereby expanding its addressable market (largely plywood-led) to nearly ₹49,000 crore versus ₹11,000 crore in FY22.
“With a steady Laminate segment and ramp up of new segments of Plywood and chipboard, we expect overall revenues to grow at a CAGR of 16.7 per cent over FY25-FY28E to ₹4,079 crore with margins expanding to 13.7 per cent in FY28 versus 10.7 per cent in FY25,” said Pandey.
“Given the strong earnings growth (nearly 53 per cent over FY25-28E), we expect return ratios of Greenlam to reach respectable mid-teens levels,” said Pandey.
Data Patterns (India) | Last traded price: ₹2731.15 | Target price: ₹3,560
Pandey said Data Patterns is one of the fastest-growing defence and aerospace electronics providers.
As of FY25, radars contribute nearly 52 per cent of revenue, while electronic warfare contributes nearly 17 per cent.
With a strong order backlog of nearly ₹1,080 crore (1.5 times trailing twelve-month revenue) and guided inflows of ₹2,000–3,000 crore over the next two years, revenue visibility remains robust.
The company clientele includes government (MoD, DRDO, PSUs) and private clients, including exports.
“Rising demand for advanced defence platforms positions the company well for sustained growth, with key opportunities in fighter jets (Sukhoi, Tejas, Advanced Medium Combat Aircraft), missiles (BrahMos), naval systems, and the space segment (micro-satellites, space-based radars),” said Pandey.
Read all market-related news here
Read more stories by Nishant Kumar
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of the expert, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
