Suzlon Energy, Dixon, BEL, IndiGo, Kaynes Tech among MOFSL's top stock picks

Motilal Oswal Financial Services (MOFSL) in its latest strategy note said it likes Dixon Technologies (India) Ltd, Suzlon Energy, Swiggy, Jindal Stainless, Coforge, Kaynes Technology India, Radico Khaitan, V-Mart and VIP Industries among midcap stocks.  

Its largecap picks include InterGlobe Aviation (IndiGo) Bharti Airtel, ICICI Bank, State Bank of India (SBI), Infosys, Larsen & Toubro (L&T), Mahindra & Mahindra (M&M) and Eternal. MOFSL said it also prefers Bharat Electronics (BEL), TVS Motors, Tech Mahindra and Indian Hotels in the largecap space.    The domestic brokearge maintained a positive outlook on Indian equities and said the market is well-placed to retrace its 2025 underperformance, supported by improving earnings prospects, supportive domestic macro conditions, and an improved geopolitical backdrop.

The brokerage said valuations, particularly for large-cap stocks, were not demanding, with the Nifty trading at 21.3 times price-to-earnings versus its long-term average of 20.8 times, while earnings are expected to deliver mid-teens growth over FY26 and FY27. Earnings revision trends in the past four months beat expectations, MOFSL said.

"India could also benefit from the abatement of overexuberance of global AI stocks, which can prompt country rotation towards India within FII portfolios. A lower USDINR level may further offer an attractive entry point," it said. 

MOFSL said concerns around lower nominal GDP materially hurting corporate profit growth appeared overblown, as corporate earnings were driven by multiple factors beyond headline economic growth, which it said had limited explanatory power for earnings expansion. The brokerage also noted that a cooling of overexuberance in global AI stocks could trigger country rotation within foreign institutional investor portfolios in favour of India. In addition, a lower USDINR level was seen as offering a more attractive entry point.

MOFSL said its key overweight sectors were Diversified Financials, Automobiles, Capital Goods, IT Services, and Telecom, while it remained underweight on Energy, Metals, Utilities, and Staples.

MOFSL said it sees FY26 Nifty earnings growth of 12 per cent and FY27, which appears reasonably well-poised, adding that in either direction should not be too sharp from here, barring possibly for Nifty FY26 profit.