Stocks to buy: Axis Securities has rolled out a comprehensive list of 35 high-conviction stock ideas across all sectors after the Q2 FY26 earnings season, flagging where it sees the best risk–reward for the next 12–18 months. The portfolio spans financials, IT services, real estate, cement, metals, retail, FMCG, power and more, and is anchored around key structural themes such as formalisation of the economy, rising consumption, credit growth, manufacturing revival and the energy transition. The brokerage believes earnings visibility has improved across several domestic-facing sectors after Q2, with margins stabilising and volume growth holding up despite global uncertainty.
The list below builds on Axis Securities’ Q2FY26 “Top Conviction Ideas” report and lays out, sector by sector, the brokerage’s preferred stocks and its broad read-through from the latest results.
Let’s take a look
- Banks and Financials
Axis Securities’ biggest overweight is in financials, where it believes growth is bottoming out and margins are set to recover. Its seven high-conviction names are HDFC Bank, Kotak Mahindra Bank, SBI, Federal Bank, Ujjivan Small Finance Bank, Bajaj Finance and Shriram Finance. The brokerage notes that banks and small finance banks delivered around 11% year-on-year credit growth in Q2 FY26, broadly tracking system growth, with PSU banks even outpacing private peers. Axis Securities expects stronger credit growth, improving NIMs and lower credit costs to drive mid-teens earnings CAGR over FY26–28 for its coverage banks.
2. IT Services
In IT services, Axis Securities is turning more constructive as deal pipelines stabilise and clients slowly loosen technology budgets. Its preferred picks are LTIMindtree, Persistent Systems and Coforge, all mid-to-large names with deep capabilities in digital, cloud and BFSI verticals. It expects profitability to improve on the back of better utilisation, pyramid optimisation and softer attrition, with discretionary spending and AI-linked projects providing incremental levers.
3. Auto & Auto Ancillaries
Axis sees strong demand across PVs, 2Ws and CVs, along with margin recovery driven by softening commodity prices. Among ancillaries, companies with export diversification and premium product portfolios stand out. Preferred names include Motherson and high-growth EV-linked suppliers.
4. Real Estate
Axis Securities remains constructive on real estate, supported by record pre-sales, healthier balance sheets and continued strength in premium and luxury housing. Its top ideas are Prestige Estates Projects and Signature Global, which are scaling rapidly in key urban markets. It believes consolidation within the sector, formalisation and improving affordability will keep volumes resilient even if interest rates stay elevated for a while.
5. Infra – Roads & Others
The government’s large infrastructure pipeline continues to benefit companies in roads, EPC and capital goods. Axis’ conviction picks include PNC Infratech and KEC International, supported by healthy order books and consistent execution.
6. Building Materials
In building materials, Axis Securities highlights both pricing power and volume tailwinds. It backs Cera Sanitaryware for its strong brand in premium bathroom and faucet ware, and Greenply Industries for its leverage to the shift from unorganised to branded plywood and MDF.
7. Metals and Mining
Axis Securities’ conviction picks in metals and mining are APL Apollo Tubes and Hindalco. It sees steady demand visibility from infrastructure, autos and construction, supported by government capex and private project activity. APL Apollo is viewed as a structural play on the shift towards pre-engineered buildings and lighter structural solutions, while Hindalco benefits from global aluminium recovery and capacity expansion at Novelis.
8. Cement
In cement, Axis expects volume expansion and margin recovery to continue after a strong Q2. Its high-conviction picks are UltraTech Cement, Ambuja Cements, Dalmia Bharat and JK Lakshmi Cement, all of which are adding capacity and benefitting from infrastructure and housing demand. While seasonality kept sequential margins softer, the brokerage believes lower costs and price discipline will support earnings momentum into FY27.
9. Chemicals
Within chemicals and midcaps, Axis Securities’ ideas include Aarti Industries, Pitti Engineering, VA Tech Wabag and Gravita. The common thread is export opportunity, engineering and water-infra exposure, and recycling-led growth. The brokerage expects gradual demand improvement in global specialty chemicals, while companies like VA Tech Wabag and Gravita ride structural themes such as water treatment and circular economy.
10. FMCG
In FMCG, Axis Securities focuses on resilience and premiumisation, highlighting Nestlé India, Britannia Industries and DOMS Industries. These names are seen as beneficiaries of urban demand, rising per-capita incomes and deeper distribution. The brokerage expects steady volume growth coupled with mix upgrades and moderating input costs to support margin expansion in FY26, with rural recovery providing additional upside.
11. Retail
Axis Securities remains optimistic on organised retail, citing a sustained improvement in store productivity and normalising footfalls. Its top picks are V-Mart Retail and Avenue Supermarts (D-Mart). The brokerage believes both players are well-placed to ride consumption growth and formalisation, supported by measured network expansion and balance-sheet strength.
12. Power and Utilities
In power and utilities, the brokerage prefers names with visibility on capex and regulated or long-term contracted revenues. Its conviction list includes NTPC, JSW Energy and Skipper. NTPC is ramping up renewable energy capacity alongside its core thermal portfolio, while JSW Energy is scaling storage and green projects. Skipper, a key supplier of transmission towers and structures, entered Q2 FY26 with a record ₹8,820 crore order book.
13. Telecom
Axis keeps it simple in telecom, with a single high-conviction idea: Bharti Airtel. The brokerage expects the company to benefit from tariff hikes, rising 5G adoption, premium ARPU growth and a scaling enterprise business. With sector consolidation largely behind and capex moderating over time, it sees improving free cash flows and balance-sheet strength supporting shareholder returns.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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