Q1 Results 2026: 5 Stocks to Buy After Earnings; Vishal Mega Mart, Cipla, IndiGo Among Top Picks - Kotak Neo Research

Indian equity benchmarks remained under pressure on Friday, extending their losing streak as elevated crude oil prices, persistent foreign institutional investor (FII) selling and renewed geopolitical tensions in West Asia continued to weigh on sentiment. Brent crude hovered around the $100-a-barrel mark after fresh attacks on Saudi oil tankers in the Red Sea heightened concerns over global energy supplies, while a weaker rupee added to investor caution.

The Sensex fell 577.87 points, or 0.76%, to 75,813.52, while the Nifty 50 declined 166 points, or 0.70%, to 23,703.60. India VIX rose 5.34% to 14.20, reflecting higher market volatility. Most sectoral indices traded in the red, with weakness seen across auto, metals and financials.

According to Kotak Neo's technical view, the short-term market texture remains weak. The research note expects selling pressure to persist as long as the Nifty trades below the immediate resistance zone, while volatility is likely to remain elevated amid geopolitical developments and crude oil price movements. Investors are also expected to track foreign fund flows and the trajectory of oil prices for near-term market direction.

Against this backdrop, Kotak Neo Research has identified five BUY-rated stocks following the June-quarter earnings season, citing attractive valuations and favourable medium-term earnings prospects. The recommendations span retail, hospitality, pharmaceuticals, quick commerce and aviation.

Vishal Mega Mart: BUY, Fair Value ₹150

Kotak neo Research retains a BUY rating on Vishal Mega Mart with a fair value of ₹150 against the current market price of ₹110.

Consolidated revenue rose 19% year-on-year in Q1 FY27, supported by 10% same-store sales growth and an 11.3% increase in retail area. Revenue, however, came in 1.9% below estimates, largely because recently opened stores contributed less than expected. The company added 24 stores during the quarter, taking its total store count to 819.

Gross margin expanded to 28.7%, beating estimates by 50 basis points and improving 30 basis points from a year ago on better procurement efficiency. EBITDA stood at ₹544.6 crore, 3.2% below estimates, as higher employee costs offset part of the margin gains. The research note lowered its FY27-FY29 EBITDA estimates by 1-3% to factor in higher wage costs while retaining the fair value at ₹150 after rolling forward its valuation.

Mahindra Holidays & Resorts: BUY, Fair Value ₹300

Kotak retains a BUY rating on Mahindra Holidays & Resorts with a revised sum-of-the-parts fair value of ₹300, compared with ₹350 earlier. The current market price is ₹218.

The company reported a weak June quarter as its ongoing business transition weighed on growth and profitability. New membership sales declined 8% year-on-year, while member additions fell 30%. EBITDA and net profit dropped 17.8% and 28.8%, respectively, with EBITDA margin contracting by 650 basis points.

Membership sales value nevertheless rose 21.3% to ₹154 crore, driven by a sharp increase in upgrades. The company also remains on track to add around 1,000 keys this year as it shifts towards a more premium vacation ownership model.

Cipla: BUY, Fair Value ₹1,660

The Kotak Neo Research maintains a BUY rating on Cipla with a fair value of ₹1,660 against the current market price of ₹1,393.

Revenue increased 4% year-on-year and 11% sequentially to ₹7,120 crore in Q1 FY27, broadly in line with expectations. EBITDA margin improved to 16.7% from the previous quarter, although adjusted margin remained lower than a year ago. Net profit declined 39% year-on-year.

The note expects the company's US business to recover through FY27, supported by new product launches, while India and emerging markets are likely to remain steady contributors. It projects earnings per share to grow at around 10% annually over FY26-FY29.

Eternal: BUY, Fair Value ₹395

The firm retains a BUY rating on Eternal with a fair value of ₹395 against the current market price of ₹287, while continuing to maintain a REDUCE rating on Avenue Supermarts (DMart).

It expects Blinkit to overtake DMart on revenue by the third quarter of FY27 despite operating with lower margins. Blinkit's gross order value is projected to grow at a faster pace than food delivery over the next few years, supported by continued expansion in quick commerce.

While competition in the segment remains intense, the report expects Blinkit's improving operating leverage and scale to support earnings growth over the medium term.

InterGlobe Aviation (IndiGo): BUY, Fair Value ₹5,900

Kotak retains a BUY rating on InterGlobe Aviation with a fair value of ₹5,900 against the current market price of ₹5,024.

The airline's June-quarter earnings missed expectations primarily because of sharply higher fuel costs. Even so, the report noted that IndiGo was able to pass on a significant portion of the increase through pricing during the quarter and expects the airline to continue adjusting fares if elevated fuel costs persist.

It sees pricing discipline as the key variable to watch over the coming quarters, particularly if crude oil prices remain elevated and cost pressures continue.

Indian equity markets traded lower on Friday as crude oil prices remained above $100 a barrel following renewed tensions in West Asia. The Sensex fell 577.87 points, or 0.76%, to 75,813.52, while the Nifty 50 declined 166 points, or 0.70%, with higher energy prices weighing on overall market sentiment.

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