Stocks to buy for the long term: Domestic market sentiment remains weak, largely due to relentless foreign capital outflow, geopolitical uncertainties, and mixed Q3 earnings so far. Equity benchmark Nifty 50 remained flat for the week ended Friday, January 16, staying in a range of 25,470-25,900.
Experts expect the market to continue witnessing stock-specific action amid the ongoing Q3 results season in the near term.
However, they remain positive about the market’s prospects for the medium to long-term due to a healthy macro environment, policy support, and expectations of further rate cuts by the RBI.
Nandish Shah, AVP– PCG Research and Advisory, (Fundamental) Wealth Management, Motilal Oswal Financial Services, suggests picking quality stocks for the long term.
He is bullish on the following five stocks. Take a look:
Stock picks for the long term
Bharti Airtel
Shah pointed out that Bharti Airtel continues to demonstrate strong execution across its core businesses, reinforcing its leadership in premium mobility and digital infrastructure.
Management reiterated moderation in FY26 capex and highlighted healthy FCF generation of ₹146 billion, despite higher network investments.
Key structural drivers—premiumisation, ARPU gains, broadband expansion, and Nxtra’s data centre growth—strengthen Bharti’s long-term cash flow visibility.
“We maintain a buy, driven by consistent operational outperformance, steady FCF generation, and multi-year earnings visibility from 5G rollout, broadband growth, and digital infrastructure expansion. We model a CAGR of 15% and 18% in Bharti Airtel’s consolidated revenue and EBITDA over FY25-28E, respectively,” said Shah.
Bharat Electronics
Bharat Electronics (BEL) continues to reinforce its leadership in India’s defence electronics space, supported by strong execution and a resilient order pipeline.
In Q2FY26, the company reported a robust beat across metrics — revenue rose 26% YoY, EBITDA margin improved to 29.4%, and PAT grew 18% YoY — driven by superior cost control and project execution.
The order book stood healthy at ₹746 billion, with inflows more than doubling YoY.
Management reaffirmed its long-term export strategy, targeting an increase from 3-4% of turnover to 5% over the next two to three years, eventually reaching 10% of total revenues, led by key programs such as QRSAM, Project Kusha, and next-generation corvettes.
“With expanding system integration capabilities, a strong export order book, and visibility from large defence projects, we estimate steady growth ahead,” said Shah.
ICICI Bank
Shah pointed out that ICICI Bank continues to deliver an exemplary performance, rising above all sectoral challenges, as it sustains RoA in the range of 2.3-2.4%, which is even beyond the aspirational level for most banks.
Moreover, the bank has maintained a strong balance sheet as provisions declined 26% YoY and 50% QoQ, placing the bank well on track to comfortably beat its credit cost guidance.
The bank remains focused on delivering superior risk-adjusted returns, supported by prudent underwriting practices and strong credit discipline.
Shah underscored that the bank’s investment in technology has resulted in consistent productivity gains, along with market share gains and steady improvement in cost ratios. Asset quality remains under control, while ECL impact is expected to be fairly manageable for the bank.
Mahindra and Mahindra
Shah highlighted Mahindra and Mahindra (M&M) targets strong long-term growth, aiming for 8 times expansion in SUVs and light commercial vehicles and 3 times growth in the farm segment over FY20–30 (implying a 12% revenue CAGR), supported by upcoming launches like XEV 9S, NU-IQ platform rollout from 2027, and a 1.6 times volume increase in the sub-3.5-tonne segment.
Shah further said that M&M’s growth businesses are scaling rapidly, including Last Mile Mobility targeting 6 times revenue growth, trucks and buses aiming for a top-three ILCV position, aerostructures pursuing a global top-ten ranking, Mahindra Holidays targeting 3 times keys, 3 times revenue and 4 times PAT growth, and Lifespace planning over 14 times sales growth this decade.
Management has indicated that it would look to enter one new segment next year, provided it fits in M&M’s guiding principles of delivering 18% RoE on a sustainable basis in the long run.
HCL Technologies
HCL Technologies continues to benefit from its diversified, all-weather portfolio, which is performing well amid uncertain demand conditions.
Strong deal traction and improving service mix underpin confidence in sustained growth, with the company maintaining its position as the fastest-growing large-cap IT services player.
AI conversations have matured from experimentation to enterprise-wide business reimagination, with clients prioritising data lifecycle management, AI readiness, infrastructure, and foundational services.
While large-scale deployments remain early, this shift is supporting revenue momentum, reflected in 4.2% QoQ CC growth and $3 billion deal TCV.
Profitability remained resilient with EBIT margins at 18.6%, supported by execution strength despite macro uncertainty. FY26 revenue guidance was increased to 4–4.5% YoY CC, while long-term outlook remains positive, with USD revenue/INR PAT CAGR of 6.7%/8.9% over FY25–28.
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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.
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