Kolkata: IT stocks are almost in a free fall in India and bellwethers have not been spared either. Motilal Oswal has assigned a Buy signal on Infosys against this backdrop. The other stock is Varun Beverages — one of the premium bottlers of the country. let’s have a close look at why the domestic brokerage major thinks the two stocks could make good buys. The basis seems to be the analysis of the Q3 results analysis of both companies and the management interactions.
Infosys
Target Price: Rs 1,850
After dipping almost 4%, the stock of Infosys was trading at Rs 1,274.80 around 2:30 on Tuesday, Feb 24. The target price implies a 45% potential upside on this IT bellwether, which has been suffering from AI jitters over the past several days. Motilal Oswal has said that the company is now chasing an AI-first strategy. Motilal Oswal also said that the gap technology capability and actual deployment creates a new opportunity that Infosys can exploit by offering specialised services.
According to Infosys management, the market for AI-led services can expand to $300-$400 billion by the end of this decade. Motilal Oswal has mentioned that partnerships with technology firms such as Cognition and Anthropic are helping Infosys expand the skill set in solution stack. These partnerships will also boost project execution capabilities as enterprises start scaling use of AI-driven tools for such assignments. “This AI tech transition is different from prior tech shifts, with foundational model innovation advancing faster than enterprise adoption,” mentioned the broking firm in its note.
The brokerage also thinks a cyclical recovery in core segments is taking place. This will pave the way for growth in the future. The earning estimates won’t really be affected in the near terms, says Motilal. Infosys is undertaking intensive reskilling of a large section of its workforce to migrate towards a career with specialised paths and expert layers. Motilal also flagged the role of Infosys Topaz Fabric, which is an AI-first, cloud-first and partner-first platform to accelerate enterprise AI adoption through a composable, open, and interoperable stack of AI agents. This will help in connecting models and enterprise systems, said the brokerage. It thinks Infosys is attractive, especially when ones considers the FY28 earnings projections.
Varun Beverages
Target Price: Rs 550
The market price of this bottling major is Rs 455.85 around 3 pm today. Therefore, it target price signals a 20.65% upside potential. Motilal thinks the company is stepping into its next phase of growth which consists in international expansion. This is happening in South Africa. Varun beverages is setting up a manufacturing and distribution base there. Motilal said the company already has more than 90% of the PepsiCo market in India, which gives it formidable heft. Now it is exploiting the project execution skills to expand to new regions in the planet. It has acquired BevCo and Twizza which can lend it a cumulative market share of about 27% in South Africa. Motilal Oswal Financial Services said the manufacturing base in Africa remains underutilized.In other words, it means the company can fast expand in that country without much capital expenditure.
In India, the focus of Varun beverages remains product innovation. It is entering the energy drinks segments such as Nimbooz Jeera. Nearly 59% of the portfolio now comprises low or no-sugar products, which is one of the trends for the future. Strong volume growth with margin stability have been forecast in FY26. “Africa has emerged as VBL’s next scalable growth engine, evolving from a franchise-led presence into a structurally important international platform,” mentioned Motilal Oswal.
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