Top stocks to buy today: Analyst bets on Cummins India, Infosys; check why

Shrikant Chouhan, head of equity research at Kotak Securities, remains upbeat on Cummins India and Infosys shares today. Check out the key reasons here

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Stock recommendations: 

Cummins India : Add

CMP: ₹4,349

FV: Rs. ₹4,600

Support: ₹4,200/₹4,000

Resistance: ₹4,450/₹4,600

Cummins India Ltd (CIL) is a major manufacturer of diesel engines across various kVA classes, catering to the electrical power generation needs of industrial, commercial, and export markets. Backed by strong multinational parentage, the company enjoys a technological and operational edge. Unlike most capital goods companies, Cummins operates in a relatively non-cyclical space, as it is least exposed to direct private corporate capex and cyclical industries such as power, cement, steel, and oil & gas. Instead, its business mix is more skewed toward steady-demand sectors like commercial and residential real estate, manufacturing, small offices, and data centers.

 

Cummins continues to leverage its broad product range, economies of scale, and cost efficiency to maintain dominance and withstand competitive pressures. It is particularly well-positioned in the fast-growing data center segment—an area witnessing intensifying competition. Cummins’ strength in this market is underpinned by its long-standing experience, the strong acceptance of its products among major data center players, and its ability to provide highly specialised aftermarket support. The company supplies key components used in gensets for data centers, giving it a strong and growing presence in this high-potential space.

 

In Q2FY26, Cummins reported a sharp beat in results, largely driven by lumpy data center sales, while most other business segments also grew at a strong and faster-than-expected pace. Revenue, Ebitda, and PAT rose 27 per cent, 44 per cent, and 42 per cent Y-o-Y respectively. The Ebitda margin expanded by about 260 bps Y-o-Y to 21.7 per cent, reflecting cost control and pricing strength. Additionally, gross margins improved 75 bps Y-o-Y, defying the impact of higher bought-out components post-CPCB IV+ implementation and rising competitive intensity. Power generation revenues surged 50 per cent Y-o-Y (20 per cent excluding data center projects), supported by a rebound in industry volumes to pre-CPCB IV+ levels.

 

Management has guided for double-digit revenue growth in FY26 and expects sustained momentum over the medium term. We expect 14–16 per cent CAGR in revenue, Ebitda, and PAT over FY25–28. With its diversified market exposure, strong positioning in growth segments, Cummins remains our top pick within the capital goods space. We have Add rating on the stock with a fair value of ₹4,600.

Infosys (INFO): Buy

CMP: ₹1,513

FV: ₹1,800

Support: ₹1,480/₹1,450

Resistance: ₹1,600/₹1,700

Infosys is a leading global company that provides digital services and consulting to help businesses transform and grow in the modern world. The Company has more than 320,000 employees working together to help people, companies, and communities reach their full potential.

 

Its approach focuses on three key areas:

 

AI-first core: Infosys helps companies use artificial intelligence and cloud technology to strengthen their core systems and make smarter decisions.

 

Agile digital at scale: It enables businesses to quickly adopt digital solutions that can grow and adapt as their needs change.

 

Continuous learning: Infosys encourages ongoing learning and innovation by sharing digital skills, knowledge, and ideas from its global network of experts and partners.

 

We believe Infosys is executing well and a key pick among incumbents. Infosys has done relatively well despite challenges. We believe Infosys can be a beneficiary of AI in the medium term, though there can be headwinds in the near term from revenue deflation. Growth will accelerate as discretionary spending improves and competitive intensity in cost take-out deals and renewals normalises, although there is a lack of visibility for this scenario now.

 

The company operates in 59 countries, supporting clients as they move through their digital transformation journeys. With over 40 years of experience, Infosys has deep knowledge of how large organisations work and how technology can make them more efficient and innovative.

 

Large-deal TCV increased 26 per cent Y-o-Y to $3.1 bn in Q2FY26. New TCV of $2.05 bn, increased 106 per cent Y-o-Y and is at healthy levels. Both TCV and new components will increase sharply in Q3FY26, as the mega NHS deal gets factored in. The deal win TCV of $6.9 bn grew 5.3 per cent in H1FY26 Y-o-Y, a decent outcome. New deal TCV in H1FY26 grew strongly at 23 per cent Y-o-Y to $4.1billion.

 

(Shrikant Chouhan is the head of equity research at Kotak Securities. Views expressed are his own.)