Jefferies Gives 'Buy' Ratings to Several Stocks

What do a bank, a defence equipment manufacturer, a hospital chain and a cigarette company have in common? Jefferies , the global investment bank has given a ‘Buy’ rating to a select number of stocks. Its targets suggest an upside of 30% to 54%. Here is what Jefferies list of Buy recommendations comprise of and the risks therein – Jefferies has maintained its ‘Buy’ rating on PB Fintech with a target price of Rs 1,540, indicating an upside potential of 54%. The global investment bank sees continued growth in insurance distribution, although higher operating expenses and regulatory changes remain key concerns. PB Fintech reported a 35% year-on-year (YoY) increase in revenue in Q2FY27, ahead of Jefferies’ estimates. Its adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 39% to Rs 220 crore. However, this was below expectations because of higher expenses. The insurance business remains the key growth driver. Total insurance premiums increased 38% YoY, while new health and term insurance premiums grew 42%. Health insurance premiums alone increased 46%. The renewal take rate improved by around 60 basis points to 7.9%. Jefferies also expects PB Health to reach a monthly revenue run rate of Rs 40-50 crore by March 2026, with the business approaching break-even. However, advertising and promotional expenses increased 59%, while Paisabazaar’s credit disbursements remained broadly flat sequentially. According to the report, “Core insurance growth remains strong: Total insurance premium grew 38% y-y.” Jefferies has reduced its FY27 profit after tax estimate by 3% to account for higher expenses. It also flagged the possibility of slower growth in the second half as the benefit from Goods and Services Tax (GST)-related changes fades. Jefferies has maintained its ‘Buy’ rating on Lodha Developers and raised its target price to Rs 1,450 from Rs 1,400. This indicates an upside potential of 40%. Apart from residential property sales, Jefferies sees data centre development as an additional growth opportunity. The company’s pre-sales increased 7% YoY to Rs 9,600 crore in the first half of FY27, accounting for around 40% of its full-year guidance. Jefferies expects momentum to improve in the second half as the company accelerates project launches. Its launch pipeline for the second half stands at Rs 19,100 crore, compared with Rs 4,100 crore in the first half. The company is also expecting a data centre land transaction worth around Rs 1,500 crore. The data centre business is another area to watch. Lodha has increased its planned power tie-ups to 5 gigawatts (GW), from 3 GW earlier. Jefferies expects land monetisation and future leasing income to support its longer-term growth. Jefferies report said, “Pre-sales momentum is set to gather pace in 2H as a 4x+ faster launch pace vs. 1H and continued strong demand for Datacenter land are expected to drive >20% growth in 2H.” However, cash collections declined 1% YoY in the September quarter, while operating cash flow fell 39%. A recovery in collections will be important for the company’s expansion plans. Jefferies has maintained a ‘Buy’ rating on State Bank of India (SBI) with a target price of Rs 1,320, indicating an upside potential of 34%. The global investment bank expects improving lending margins, loan growth and stable asset quality to support the bank’s earnings. SBI reported a September quarter profit of Rs 23,000 crore, up 14% YoY and ahead of Jefferies’ estimates. Net interest income (NII), which represents the difference between interest earned on loans and interest paid on deposits, increased 15%. The bank’s domestic net interest margin (NIM) improved by 11 basis points sequentially to 3.1%. Loan growth stood at 18%, while deposits increased 12%. Jefferies believes there is further room for margin improvement through interest rate changes and the deployment of surplus liquidity. The bank’s liquidity coverage ratio (LCR) improved from 126% in June to 140% in September. Jefferies expects core profit to grow at a compound annual growth rate (CAGR) of 14% between FY26-29. However, higher operating expenses affected the reported operating performance. The global investment bank believes some expenses were booked earlier than expected, which could support a stronger fourth quarter. Jefferies has maintained its ‘Buy’ rating on Bharat Electronics (BEL) with a target price of Rs 490, implying an upside potential of 30%. BEL’s September quarter EBITDA was 15% above Jefferies’ expectations, supported by stronger revenue and margins. The company reported 26% YoY revenue growth during the quarter. Its order book stood at Rs 68,700 crore, equivalent to around 2.5 times its FY26 revenue. Jefferies’ expects additional orders from defence programmes to support future execution. One of the major opportunities is the Rs 30,000 crore Quick Reaction Surface-to-Air Missile (QRSAM) programme. Jefferies expects this order to come through by March 2027, subject to the required approvals. The company has also retained its order inflow guidance of Rs 55,000 crore for FY27. Its three-year order pipeline stands at around Rs 1.3 lakh crore. Jefferies said, “Management is confident of Rs300 bn QRSAM order coming by end FY27E and maintained Rs550 bn order flow guidance.” Jefferies has maintained its ‘Buy’ rating on Max Healthcare Institute with a revised target price of Rs 1,200, compared with Rs 1,260 earlier. This suggests an upside potential of 35%. The hospital chain reported 18% YoY growth in both revenue and EBITDA during the September quarter. Revenue stood at Rs 3,050 crore, while EBITDA increased to Rs 810 crore. Growth was supported by higher patient volumes and the addition of beds. The company added around 760 beds during the year, while its occupancy rate stood at 77%. Expansion is expected to remain an important growth driver. Around 260 beds at Max Smart in Delhi have become operational, with another 140 beds expected to open. The company has also started operations at its new oncology block in Dwarka. The board has approved an additional 209 beds across its Noida, BLK and Vaishali hospitals. A new 500-bed hospital in Gurugram is expected to begin operations towards the end of FY27. However, the discontinuation of select oncology drugs for institutional patients has affected revenue. Jefferies expects this pressure to ease from the December quarter as the comparison base normalises. Jefferies expects EBITDA to grow at an 18% CAGR between FY26-29. Jefferies has maintained its ‘Buy’ rating on Bajaj Finserv , with a revised target price of Rs 2,300 against Rs 2,550 earlier. The new target indicates an upside potential of 34%. Jefferies sees growth in Bajaj Finance and Bajaj Life Insurance as important earnings drivers. However, weaker general insurance performance and regulatory uncertainty have led it to reduce its estimates. Bajaj Finserv’s core profit increased 25% YoY during the September quarter. The life insurance business also reported an improvement in profitability. Its value of new business (VNB) margin increased 450 basis points to 21.6%, while VNB grew 40%. The healthcare business also reported a 33% decline in revenue because of proposed regulatory changes. Meanwhile, the mutual fund business continues to expand but remains relatively small. Jefferies expects Bajaj Finserv’s earnings to grow at a CAGR of 23% between FY26 and FY29. It has reduced its target price because of lower valuation multiples for its insurance businesses and a higher holding company discount. Jefferies has maintained its ‘Buy’ rating on ITC with a target price of Rs 350, indicating an upside potential of 32%. Jefferies expects the company’s fast-moving consumer goods (FMCG) and paperboards businesses to provide support while its cigarette segment works through higher taxation. ITC’s net revenue increased around 3% YoY in the September quarter. However, operating EBITDA and profit before tax declined 17-18%. The cigarette business remained under pressure. Revenue declined around 21%, while cigarette volumes fell nearly 8%. Earnings before interest and taxes (EBIT) in the segment declined 27%, reflecting the impact of higher taxes and lower volumes. Jefferies expects calibrated price increases and changes to the product portfolio to support a gradual improvement. However, the growing price difference between legal and illicit cigarettes remains a concern. The FMCG business offered a different picture. Revenue increased around 17% YoY, marking its fourth consecutive quarter of double-digit growth. Several categories, including biscuits, snacks, noodles, spices and homecare, recorded growth of more than 20%. The paperboards business also reported improvement, with revenue rising 36% and EBIT increasing 48%. The agriculture business recorded 12% revenue growth. According to the report, “FMCG & Paperboards reported a strong 2Q, while Agri was in line.” Jefferies has reduced its FY27-29 earnings estimates by 2-3%, but expects cigarette business performance to improve gradually as price increases take effect. For investors, the recommendations cover different business cycles and earnings opportunities. Insurance growth, data centre development, bank margins, defence orders, hospital expansion and consumer demand will determine whether these companies can deliver the earnings growth expected by Jefferies.