Nomura's Top Picks for 60% Upside: EPL, Lupin, Britannia

Nomura has issued a "Buy" rating on EPL, Lupin, and Britannia, with potential upsides of up to 60% on EPL. The brokerage firm sees strong business fundamentals across these stocks, including rising global demand, margin expansion, and distribution plays. EPL's Beauty and Cosmetics segment is growing at 35% y-o-y, and Lupin is benefiting from early approvals and complex product launches, with potential double-digit sales growth in FY26.

Nomura has issued a "Buy" rating on EPL, Lupin, and Britannia, with the potential for significant upside. The brokerage firm highlights strong business fundamentals across these stocks, including rising global demand, margin expansion, and distribution plays.

EPL, a consumer goods company, has seen its Beauty and Cosmetics segment grow at 35% year-over-year (y-o-y) [1]. Nomura has raised its target price on EPL to Rs 350, implying a 59.8% upside from its current market price of around Rs 219. The brokerage expects EPL to sustain double-digit value growth, with EBITDA growth ahead of revenue. Additionally, EPL's revenue growth in Q1FY26 came in at 10% y-o-y, beating street estimates.

Lupin, a pharmaceutical major, is also on Nomura's radar. The brokerage has a target price of Rs 2,350 on Lupin, implying a 27% upside from the current level of Rs 1,852. Lupin's Q1FY26 results showed EBITDA beating estimates slightly, while PAT surpassed expectations by 21%. The company continues to benefit from early approvals and complex product launches, with Nomura expecting a strong double-digit sales growth in FY26. Lupin's stock is currently trading at 17.5x FY26F EPS and 20.4x FY27F EPS, with strong earnings growth expected over the next two years.

Britannia Industries, an FMCG player, is the third pick with a target price of Rs 6,400, representing an 18.5% upside from the current market level. Despite muted volume growth of 2% y-o-y in Q1FY26 due to prior price hikes, transaction growth held up at 12%, indicating strong underlying demand. Nomura believes Britannia's rural demand remains strong, and its direct distribution in Central India is gaining ground. The brokerage has upgraded Britannia to "Buy" from "Neutral," with a P/E valuation of 52x on Sep-27F EPS.

Nomura's optimism is driven by the strong business fundamentals of these companies, including rising global demand, margin expansion, and distribution plays. Each of these stocks is backed by a robust business strategy, making them attractive investment opportunities.

References:
[1] https://www.financialexpress.com/market/3-buy-recommendations-by-nomura-with-up-to-60-upside-epl-lupin-britannia-3939887/
[2] https://finance.yahoo.com/news/lupin-ltd-bom-500257-q1-070438165.html