Stocks to buy for the long term: Pankaj Pandey of ICICI Securities on market outlook for Samvat 2082, and his 5 stock picks

Stocks to buy for the long term: The Indian stock market has been volatile over the past year, with the market benchmark Nifty 50 hovering around the psychological 25,000 mark for most of the trading year, largely due to external factors such as geopolitical tensions, tariff wars and regime changes in key global economies. However, domestic macroeconomic indicators have seen significant improvement be it the lower inflation, contained fiscal deficit, healthy GDP growth rate and downward sloping interest rate cycle (down 100 bp in CY25) coupled with RBI’s focus on adequate systemic liquidity. Indian stock market: Samvat 2082 outlook According to Pankaj Pandey, the head of research at ICICI Securities, the main short-term triggers for the Indian stock market are the real demand growth across consumer categories in the ongoing festive season, due to the GST rate cut and a potential trade deal between the US and India. Pandey believes corporate earnings could grow at 12 percent CAGR over FY25-27E. “We expect double-digit earnings growth to resume from FY27E, which should ensure healthy equity returns going forward. Our medium to long-term outlook is positive,” says Pandey. “With improved growth prospects amid greater purchasing power in the hands of consumers through income tax and GST rate cuts as well as the government’s relentless focus on increasing manufacturing GDP through policy reforms, we remain bullish on markets,” Pandey said. “With the rest of the asset classes, namely global equities, debt and precious metals (gold, silver) delivering healthy returns in the recent past, the stage is set for local equities to outperform peers going forward,” he said. Stock picks for the long term CreditAccess Grameen | Last Traded Price: ₹1,388.95 | Target price: ₹ 1,600 Pandey underlined that CreditAccess Grameen, a leading NBFC-MFI in India, boasts of over three decades of experience and manages ₹ 26,055 crore AUM. Increased borrower leverage has impacted credit growth (-2.5% in FY25), asset quality (GNPA up 360 bps at nearly 4.8%) and earnings (down 63.2% in FY25), Pandey said. He believes that the limitation of lenders’ leverage, the creation of a supply buffer and continued foothold in the rural economy can stabilize the asset quality trend and thus result in a revival in payout. “We expect a healthy revival in H2FY26, delivering AUM growth of 14-18 per cent in FY26. Expecting revival in business growth, improvement in collections and yield ratios, we maintain a positive view on the company,” Pandey said. Kaynes Technology India | Last Traded Price: ₹6,991.80 | Target price: ₹8,900 Pandey pointed out that Kaynes Technology India (Kaynes) is a leading electronics manufacturing services (EMS) company, integrating electronic circuit boards and other components into final, ready-to-use products/sub-products across sectors such as automotive, industrial, aerospace, railways, medical and IoT. Its revenue has grown aggressively at 56.8 percent CAGR over FY22-25 and is poised for 48.1 percent CAGR over FY25-28E. The company is investing over ₹ 3,300 crore in chip manufacturing and over ₹ 1,400 crore in PCB manufacturing, which will be margin attractive and help long-term business growth. “With a robust growth trajectory, differentiated capabilities and proven execution, Kaynes is well positioned to benefit from India’s electronics and semiconductor revolution,” Pandey said. AIA Engineering | Previous Close: ₹3,319.65 | Target price: ₹4,060 Pandey said AIA Engineering (AIA) is India’s largest manufacturer and supplier of high chrome wear, corrosion and abrasion resistance castings used in cement, mining and thermal power plants (or mills). AIA saw a tepid business down 12.7 percent over FY23-25 ​​due to multiple headwinds, which we believe has bottomed out and will start delivering results from H2FY26E. The recent order win in Chile and the decision to place greenfield plants in China and Ghana reiterate our thesis. “We expect revenue, EBITDA and PAT to grow at 7.3 per cent, 7.3 per cent and 7.5 per cent CAGR over FY25-27E. We recommend a buy rating with a target of ₹4,060 (30 times FY27E EPS),” Pandey said. Greenlam Industries | Previous close: ₹259 | Target price: ₹300 Pandey underlined that Greenlam Industries has completed greenfield expansion for plywood and chipboard categories, along with brownfield expansion for laminate, incurring nearly ₹1,450 crore capex over the past three years, thereby expanding its addressable market (largely plywood-led) to nearly ₹0 crous ₹11,000 crore in FY22. “With a steady laminate segment and build-up of new plywood and chipboard segments, we expect overall revenue to grow at a CAGR of 16.7 per cent over FY25-FY28E to ₹4,079 crore with margins expanding to 13.7 per cent in FY28 YoY against 1 per cent in FY27,” it said. “Given the strong earnings growth (almost 53 per cent over FY25-28E), we expect yield ratios of Greenlam to reach respectable mid-teens levels,” says Pandey. Data Patterns (India) | Last Traded Price: ₹2731.15 | Target price: ₹3,560 Pandey said Data Patterns is one of the fastest growing defense and avionics suppliers. As of FY25, radars contribute nearly 52 percent of revenue, while electronic warfare contributes nearly 17 percent. With a strong order backlog of nearly ₹ 1,080 crore (1.5 times trailing twelve month revenue) and guided inflows of ₹ 2,000–3,000 crore over the next two years, revenue visibility remains robust. The company clients include government (MoD, DRDO, PSUs) and private clients including exports. “Increasing demand for advanced defense platforms positions the company well for continued growth, with key opportunities in fighter aircraft (Sukhoi, Tejas, Advanced Medium Combat Aircraft), missiles (BrahMos), naval systems and the space segment (microsatellites, space-based radars),” Pandey said. Read all market related news here Read more stories by Nishant Kumar Disclaimer: This story is for educational purpose only. The opinions and recommendations expressed are those of the expert, not Munt. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.