Godrej Consumer, Ultratech: Motilal Oswal suggests these 6 stocks to buy

Godrej Consumer has strengthened its core portfolio and expanded into new segments, while UltraTech Cement reported strong Q1 results

Large Cap

Godrej Consumer – Target price: ₹1,450

Godrej Consumer (GCPL) has strengthened its core portfolio and expanded into new segments, including the RCCL (Raymond Consumer Care) acquisition, boosting personal care. It targets double-digit volume growth by leveraging market leadership, expanding in India, and simplifying international operations. GCPL will focus on premiumisation through innovative launches, new premium categories, and channel expansion; boost efficiency via investments in manufacturing and brand building; and drive rural growth by offering affordable access packs tailored to price-sensitive consumers in these markets. We expect a growth recovery in FY26, with macro-side drives also supporting the underlying growth. With improved stability in Indonesia, performance should strengthen through the year. GCPL is projected to deliver a sales/Ebitda/Adj. PAT CAGR of 12 per cent/13 per cent/19 per cent over FY25–28.

Ultratech Cement – Target price: ₹14,600

UltraTech Cement reported strong Q1 results with consolidated revenue up 13 per cent year-on-year (Y-o-Y) to ₹212.8 billion, led by 10 per cent volume growth and 3 per cent better realisations. Earnings before interest, taxes, depreciation and amortisation (Ebitda) rose 46 per cent Y-o-Y to ₹44.1 billion as improved pricing and 3 per cent lower opex/t drove profitability. Operating margin expanded ~470 basis points (bps) Y-o-Y to 21 per cent, due to Mix of better realisations and sharper cost control. Profit after tax (PAT) rose 44 per cent Y-o-Y to ₹22.5 billion. RMC revenue jumped 23 per cent Y-o-Y on strong infra and housing demand. Integration of ICEM & Kesoram assets is on track, aiding cost efficiency. Capex of ₹100 billion for FY26 is well-managed, with stable debt. Management expects rural and urban housing to fuel further growth. We assign a 'Buy' rating, driven by margin tailwinds, cost control, and healthy demand outlook. 

Mid Cap

Vishal Mega Mart – Target price: ₹170

Vishal Mega Mart (VMM) delivered a strong performance in Q1FY26, with 21 per cent Y-o-Y revenue growth, led by 21 net store additions (+15 per cent Y-o-Y) and resilient ~11.4 per cent SSSG, despite a shift in Eid to Q4FY25. We believe that VMM's unique business model, characterized by: 1) a wide presence in Tier 2+ cities (717 stores in 472 cities), 2) a well-diversified exposure to key consumption baskets; 3) a strong and affordable own brands portfolio (~76 per cent revenue share), and 4) one of the lowest cost structures, provides it with strong moats against both offline and online value retailers. We model a CAGR of 20 per cent/21 per cent/27 per cent in revenue/Eitda/PAT over FY25-28E, driven by ~13 per cent CAGR in store additions and double-digit SSSG.

Bharat Dynamics – Target price: ₹1,900

Bharat Dynamics delivered 30 per cent Y-o-Y revenue growth in execution in Q1FY26 on a strong order book and the easing of supply chain issues. With a strong order book of nearly ₹233 billion, we expect execution to scale up further in the coming quarters Margin expansion visibility is underpinned by indigenization (80–90 per cent local content), in-house RF seeker production, and capacity additions in SAMs, VSHORAD, and ATGMs, lowering input costs and improving scale efficiencies for sustained profitability. We upgrade BDL to 'Buy' with target price of ₹1,900 (42x Sep’27E EPS) as valuations turn reasonable post 25 per cent correction. We Expect FY25–28 revenue/Ebitda/PAT CAGR of 35 per cent/64 per cent/51 per cent, driving RoE/RoCE above 25 per cent by FY28. 

Small Cap

Avalon Tech – Target price: ₹1,100

Avalon Technologies reported a strong Q1FY26, with revenue up 62 per cent Y-o-Y, fueled by a stellar performance in both Indian and US markets. Ebitda margin rose 700 bps, supported by higher domestic manufacturing (80 per cent) and favorable operating leverage. The company has raised its FY26 revenue growth guidance to 23–25 per cent (from 18–20 per cent) and aims to double revenue by FY27, driven by strong growth in India. With a ~23 per cent Y-o-Y rise in order book (₹17.9 billion) and robust Q1FY26 performance, sequential Ebitda margin improvement is expected. The company’s long-term revenue outlook remains strong, driven by its entry into semiconductor equipment, strategic high-margin collaborations, solid order book visibility, and India’s rise as a manufacturing hub supported by structural reforms. We estimate AVALON to post 30 per cent/42 per cent/60 per cent CAGR in revenue/Ebitda/adj. PAT over FY25-FY27.

VA Tech – Target Price: ₹1,900

VATW delivered a strong Q1FY26 with revenue/Ebitda/PAT up 17 per cent/18 per cent/20 per cent Y-o-Y and margins at 13 per cent. Its robust ₹158 billion order book (~4.7x TTM revenue) and ₹150–200 billion bid pipeline support 15–20 per cent revenue CAGR guidance over the next 3–4 years. Key wins include the 400 MLD Chennai desalination, 300 MLD Yanbu desalination, and large industrial/O&M projects, ensuring profitable growth with selective, high-margin bidding. Management targets Ebitda margins of 13–15 per cent (driven by large-scale projects and overseas opportunities) and expects strong FCF and return ratio expansion. We forecast FY25–28 CAGR of 17 per cent/22 per cent/23 per cent in revenue/Ebitda/PAT. Reiterate BUY (26x FY27E P/E, +1SD), backed by healthy execution visibility and improving profitability.  (Disclaimer: This article is by Motilal Oswal Financial Services Research desk. Views expressed are its own.)