HAL, Siemens, Larsen & Toubro among Jefferies' top stock picks; here's why
For HAL, Jefferies sets a bull case target of Rs 7,500, indicating a potential 50% rise, predicting significant growth driven by strong order flows and improved earnings visibility.
- Jun 5, 2025,
- Updated Jun 5, 2025 9:09 AM IST
Jefferies, a prominent brokerage firm, has named Hindustan Aeronautics (HAL), Siemens, Larsen & Toubro (L&T), and KEI Industries as its top investment picks in the engineering and construction sector. The recommendation is driven by strong order flow trends and improved earnings visibility, particularly in the defence and infrastructure sectors.
Jefferies noted that defence order flows have surged 89% year-on-year, and this momentum is expected to continue through the financial year. The brokerage highlights that power and defence stocks enjoy high visibility, while the railway sector sentiment has also improved. For HAL, Jefferies sets a bull case target of Rs 7,500, indicating a potential 50% rise. The base case projects a 30% gain to Rs 6,475, supported by a robust order pipeline worth approximately Rs 1.7 lakh crore.
Siemens is also highlighted by Jefferies, with expectations of stronger exports, improved asset turnover, and better margins. The bull case target for Siemens is set at Rs 4,500, implying a 36% upside. In the base case, the target is Rs 3,700, offering a 12% potential increase.
For L&T, Jefferies anticipates a stock price of Rs 3,965 in the base case, reflecting a 9% upside. This projection is supported by an estimated 18% compound annual growth rate (CAGR) in revenue and margin improvements in hydrocarbon and heavy engineering businesses. These projections are based on continued operating leverage among key players in the sector.
KEI Industries stands out with the highest projected upside among the four companies. Jefferies projects a bull case target of Rs 5,625 for KEI Industries, marking a 59% increase from current levels. The brokerage expects KEI's earnings to grow at an annualised rate of 31% between FY25 and FY27, driven by improving retail margins.
Jefferies' report underscores the importance of these companies in the context of a broader upswing in order flows and sector growth. The positive outlook for power, defence, and railway sectors further supports these investment picks.
Jefferies, a prominent brokerage firm, has named Hindustan Aeronautics (HAL), Siemens, Larsen & Toubro (L&T), and KEI Industries as its top investment picks in the engineering and construction sector. The recommendation is driven by strong order flow trends and improved earnings visibility, particularly in the defence and infrastructure sectors.
Jefferies noted that defence order flows have surged 89% year-on-year, and this momentum is expected to continue through the financial year. The brokerage highlights that power and defence stocks enjoy high visibility, while the railway sector sentiment has also improved. For HAL, Jefferies sets a bull case target of Rs 7,500, indicating a potential 50% rise. The base case projects a 30% gain to Rs 6,475, supported by a robust order pipeline worth approximately Rs 1.7 lakh crore.
Siemens is also highlighted by Jefferies, with expectations of stronger exports, improved asset turnover, and better margins. The bull case target for Siemens is set at Rs 4,500, implying a 36% upside. In the base case, the target is Rs 3,700, offering a 12% potential increase.
For L&T, Jefferies anticipates a stock price of Rs 3,965 in the base case, reflecting a 9% upside. This projection is supported by an estimated 18% compound annual growth rate (CAGR) in revenue and margin improvements in hydrocarbon and heavy engineering businesses. These projections are based on continued operating leverage among key players in the sector.
KEI Industries stands out with the highest projected upside among the four companies. Jefferies projects a bull case target of Rs 5,625 for KEI Industries, marking a 59% increase from current levels. The brokerage expects KEI's earnings to grow at an annualised rate of 31% between FY25 and FY27, driven by improving retail margins.
Jefferies' report underscores the importance of these companies in the context of a broader upswing in order flows and sector growth. The positive outlook for power, defence, and railway sectors further supports these investment picks.