Stocks to buy for long term: Pankaj Pandey of ICICI Securities recommends 5 shares, sees up to 37% upside potential
Stocks to buy for long term: The Indian stock market looks poised for a healthy upside in the medium to long term due to healthy growth-inflation dynamics, improving earnings, and easing global uncertainties.
According to the Reserve Bank of India (RBI), retail inflation could rise slightly, but the central bank believes it may remain well within its tolerance band of 2-6%.
On the other hand, the RBI has revised its growth outlook for FY26 to 7.4% from the earlier projection of 7.3%. RBI projected real GDP growth for Q1FY27 and Q2 to 6.9% (from 6.7% earlier) and 7% (from 6.8% earlier), respectively.
Pankaj Pandey, the head of research at ICICI Securities, expects the Nifty 50 to be near 29,500 by the end of the calendar year 2026.
Pandey said investors should buy quality stocks on dips as the medium to long-term outlook remains healthy. Highlighting several stock-specific opportunities in various sectors, Pandey recommends the following five stocks for the long term:
Stock picks for the long term
IDFC First Bank | Previous close: ₹85.11 | Target price: ₹100 | Upside potential: 17.5%
Pandey highlighted that after the balance sheet restructuring, IDFC First Bank’s focus is now shifting towards sustaining growth and improving operational efficiency to achieve an uptick in RoA.
Structural improvements in the funding profile and a declining reliance on high-cost deposits position margins on a firmer footing.
“Anticipation of credit cost to trend closer to through-the-cycle level (as residual MFI stress normalises), combined with improving operating leverage, is expected to push RoA past 1% over FY27–28E,” said Pandey.
Pearl Global Industries | Previous close: ₹1,834.80 | Target price: ₹2,255 | Upside potential: 23%
Pandey highlighted that Pearl Global Industries’ diversified production base, customer and product profile positions it strongly versus peers amid ongoing trade wars and geopolitical uncertainties.
The trade deal with the US and the FTA signing with the EU and the UK provide a combined opportunity of nearly $340 billion, with India having a 4.5% export share.
Lower tariff rates and adequate resources (including skilled labour and high-quality cotton) offer a significant opportunity for India to increase its export share in these regions in the coming years.
“We expect PGIL’s revenues and PAT to grow at a CAGR of 12% and 21% over FY25-28E. However, trade deal with the US and the EU provides a large upside risk to our revenue and PAT estimates. Hence, we believe it’s a good time to enter into a diversified and de-risk business model with better earning visibility,” said Pandey.
Alivus Life Sciences | Previous close: ₹932.45 | Target price: ₹1,190 | Upside potential: 28%
Alivus Life Sciences (erstwhile Glenmark Life Sciences) is a leading developer and manufacturer of APIs (nearly 93% of FY25 revenues) with a major focus in chronic therapeutic areas such as cardiovascular disease, central nervous system disease, pain management and diabetes.
The management has guided to high single-digit revenue growth in APIs, as double-digit volume growth is likely to be pulled down by pricing pressure, with the management expecting 4-5% price erosion.
The company is planning to add significant capacity (from 1424 KL to 2690 KL) by FY28, with full capex flexibility from the new promoters (Nirma Group). Almost 400 KL is expected to be added for backward integration.
“With augmented capacities and a growing basket of products, we believe the company is well poised to accelerate growth for FY28 and beyond,” said Pandey.
Aeroflex Industries | Previous close: ₹185.65 | Target price: ₹245 | Upside potential: 32%
Aeroflex Industries manufactures and supplies stainless-steel flexible flow solutions.
With huge capex coming on live by the second half of the financial year 2027 (H2FY27), a strong addressable market globally and a recent US tariff deal, all point towards strong business performance over FY26-FY28E, coupled with a debt-free balance sheet.
“We expect the company to deliver a strong CAGR of 21.8% and 26% in revenues and PAT, respectively, over FY25-FY28E. The lean balance sheet and strong cash flow generation will improve ROCE to 27% in FY28E from 21.5% in FY25,” said Pandey.
Mahindra Lifespace Developers | Previous close: ₹369.40 | Target price: ₹505 | Upside potential: 37%
Mahindra Lifespace Developers is identified by the Mahindra Group as one of its growth gems.
It has aggressively scaled up through new business developments, adding nearly ₹28,600 crore since FY25, taking its cumulative gross development value (GDV) to almost ₹47,000 crore and providing it with multi-year pre-sales growth visibility.
The company is exiting affordable projects (a drag on margins/return ratios), which are expected to get completed by FY29.
The company is targeting residential pre-sales of nearly ₹9,500 crore in FY30 (nearly ₹10,000 crore, including IC&IC sales) at a 28% CAGR, up from ₹2,804 crore in FY25.
“Over the medium term, it targets pre-sales of nearly ₹4,500-5,000 crore by FY27 (nearly 27-34% CAGR). Currently, the stock is trading below its NAV, providing an attractive buying opportunity,” said Pandey.
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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of the expert, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
