Global brokerage firm Jefferies has highlighted four Indian stocks that it believes could deliver up to 22% returns in the coming months. These stocks span fintech, banking, aviation, and FMCG, reflecting a broad-based positive outlook supported by strong fundamentals, improving demand, and favorable policy conditions.
1. Paytm – Riding the UPI Surge
Jefferies has reiterated its “Buy” call on Paytm with a target price of ₹1,420, indicating nearly 21% upside from current levels. The optimism comes from:
- EBITDA upgrades: Earnings estimates for FY27–28 have been raised by 9-14% due to reduced operating expenses.
- Profitability turnaround: Paytm is projected to swing from a loss of about ₹1,500 crore in FY25 to a profit of ₹500 crore in FY26, and further to ₹1,200 crore in FY27.
- New growth driver: A partnership with Suryoday Small Finance Bank to launch postpaid on UPI could add around 7% to FY27 EBITDA.
- Regulatory challenges under control: While recent rules hit online gaming and rent payment services, Paytm’s exposure in those areas is minimal, ensuring limited disruption.
2. Axis Bank – Growth Normalising, Valuations Attractive
Axis Bank is another Jefferies favorite, with a target of ₹1,370, representing around 21% potential upside. Key reasons include:
- Stronger deposit growth: Retail deposit outflows are normalizing, government balances are stabilizing, and competitive deposit rates are easing.
- Credit quality improvement: Stress in unsecured personal and SME loans is moderating, with fewer technical downgrades expected in the coming quarters.
- Valuation comfort: Trading at around 1.5× one-year forward adjusted price-to-book, Axis Bank looks attractively priced. Jefferies expects stronger operational performance to drive further rerating.
3. InterGlobe Aviation (IndiGo) – Expanding Fleet with ESG Focus
For the aviation space, Jefferies has maintained a “Buy” rating on IndiGo with a target price of ₹6,925, suggesting up to 22% upside. The call is based on:
- Capacity expansion: IndiGo aims for early double-digit growth in FY26, powered by new aircraft deliveries, damp leases, returns, and a greater international capacity mix.
- Regulatory support: Approval from DGCA allows IndiGo to extend its wet-lease arrangement with Turkish Airlines until February 2026.
- ESG & efficiency initiatives: The airline is committed to reducing carbon emissions by operating a more fuel-efficient fleet, optimizing flight planning, and using lighter equipment to cut costs.
4. Patanjali Foods – Benefitting from GST Cuts and Festive Demand
Jefferies also sees upside in Patanjali Foods, with a Buy target of ₹695, implying about 16% potential gains. The drivers are:
- GST relief: Key product lines such as ghee, biscuits, toothpaste, and ayurvedic supplements have benefited from lower GST rates, which make products more affordable and boost demand.
- Recovery expected: While current trade de-stocking is a short-term challenge, demand is expected to revive by FY26, especially as the edible oil and foods segment normalizes.
- Festive season tailwinds: Rising consumption around festivals is likely to add momentum to sales.
Final Thoughts
Jefferies’ recommendations highlight opportunities across four diverse sectors:
- Paytm for fintech growth and cost discipline.
- Axis Bank for improved deposit traction and stable credit quality.
- IndiGo for capacity expansion and ESG-driven efficiency.
- Patanjali Foods for policy benefits and festive demand.
With potential upsides ranging from 16% to 22%, these stocks represent Jefferies’ conviction in India’s growth story. However, investors should also weigh risks such as regulatory changes, input cost fluctuations, and sectoral competition before making decisions.
Disclaimer:
The content provided here is for informational and educational purposes only and should not be construed as financial or investment advice. The stock recommendations, target prices, and potential returns mentioned are based on research and market analysis and may change over time. Investors should conduct their own due diligence and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.
