Top smallcap stocks to buy: Monarch Networth sees up to 51% upside; check targets

Ahead of the quarterly earnings season, domestic brokerage firm Monarch Networth Capital Ltd has suggested five smallcap stocks to buy for up 51 per cent upside potential for investors. These stocks pertain to diversified sectors including consumer durables, IT, capital goods, metals and hospitality. Here are top picks from Monarch Networth with its rationale, targets and upside potential:

Aditya Vision | Buy | Target Price: Rs 720 | Upside Potential: 20%
Monarch highlighted the retailer’s strong position in Bihar and Jharkhand and its recent expansion into Uttar Pradesh. It expects festive demand and elevated air-conditioner sales to support the product mix and margins. Store expansion remains another key trigger, with the store count expected to rise from around 210 in Q1FY27 to 318 by FY29E.

Capillary Technologies India | Buy | Target Price: Rs 700 | Upside Potential: 28%
Monarch said the IT company’s loyalty business remains its strongest pillar, accounting for more than 90 per cent of revenue, while strong deal wins could support growth. It expects margin expansion from operating leverage and from the migration of SessionM and Koginitiv clients to Capillary’s platform. The brokerage also sees further momentum in its aiRA offering.

Carborundum Universal | Buy | Target Price: Rs 1,563 | Upside Potential: 23%
Monarch sees structural demand for Carborundum Universal's ceramics business from semiconductor and defence qualification requirements. The brokerage also expects the impact of loss-making subsidiaries such as AWUKO and Foskor to fade, which could support margin recovery. It added that upstream integration across bauxite, alumina and silicon carbide provides a cost advantage.

Godawari Power & Ispat | Buy | Target Price: Rs 314 | Upside Potential: 49%
Monarch highlighted Godawari Power & Ispa Ltdt's integrated steel operations and its expansion into cold rolling and battery energy storage systems, or BESS. It said expansion of captive iron ore mining and higher pellet capacity are expected to support earnings, while the planned 20GWh BESS capacity could become a significant growth driver from FY29E. Trial production is targeted for Q1FY28.

TajGVK Hotels & Resorts | Buy | Target Price: Rs 475 | Upside Potential: 51%
Monarch said that Taj GVK Hotels' premium portfolio, Taj brand backing and debt-free balance sheet. It said the commissioning of a 256-key hotel in North Bengaluru in H2FY27 is expected to provide a meaningful boost to revenue and EBITDA from FY28 onwards. Healthy occupancy, improving room rates and refurbishment-led premiumisation are also expected to support RevPAR and operating leverage.