ONGC (Reco: Buy, FV: Rs.
GMR Airports (Reco: Buy, FV: Rs.
Ashok Leyland (Reco: Reduce, FV: Rs.
Varroc Engineering (Reco: Reduce, FV: Rs.
Siemens (Reco: Sell, FV: Rs.
ONGC (Reco: Buy, FV: Rs. 385) - Weak 4Q; TSP to BP for entire Western Offshore a positive
ONGC’s 4Q was weak with revenue 6.1% below KIE and EBITDA down 6.5% (~14% below KIE), driven by weaker volumes and one-offs. Oil/gas sales declined 5%/3% yoy (flat for FY2026), impacted by KG-98/2 delays and West Asia war. Positively, in year one of the BP TSP, MH production exceeded baseline by 2% for oil and 9% for gas despite limited capex, with likely sharper gains as new facilities come up. ONGC has now expanded TSP with BP to the full Western Offshore (69% of ONGC’s output), and expects 3-4% CAGR growth by 2030 (versus ~2% earlier declines despite IOR/EOR). Maintain BUY with FV Rs385.
GMR Airports (Reco: Buy, FV: Rs. 110) - A breather ahead before a strong comeback in FY2028
GMR Airports reported a strong 47% yoy growth in EBITDA with a modest 4% miss linked more to volatile line items—top-three assets EBITDA was a modest beat. Net debt has flattened over the past six months. A weak start to FY2027 on pax count will take out the benefits of strengthening non-aero per pax spends. Good progress was registered on self-development projects and increasing visibility of a strong uptick in FY2028 EBITDA from real estate monetization. We cut estimates by 0-6% and revise FV to Rs110 (Rs112 earlier). Key imponderables include (1) impact of commissioning of new terminal space for international in Delhi airport, (2) potential entry in new services for airports beyond the current portfolio and (3) end-game of regulatory outcomes.
Ashok Leyland (Reco: Reduce, FV: Rs. 170) - In-line quarter; tough road ahead
AL reported 4QFY26 EBITDA of Rs20.7 bn, in line with our estimates as better- than-expected gross margin print was offset by higher staff and other expenses. Given recent diesel price increase amid ongoing geopolitical tensions, we expect the CV cycle growth to moderate and outlook to be cautious; we expect volume growth to moderate as fleet operators’ profitability will get negatively impacted. Additionally, we expect profitability to decline in FY2027E due to RM headwinds and lack of operating leverage. Retain REDUCE with a revised FV of Rs170 (Rs190 earlier).
Vinati Organics (Reco: Sell, FV: Rs. 1200) - Growth remains a struggle
Vinati Organics (VOL) revealed on its 4QFY26 earnings call that declines in revenues from IBB and ATBS were the key reason for the company’s 1% revenue drop in FY2026. Management continues to guide to 15% volume growth in FY2027, but the VOPL projects continue to struggle, while market conditions and competition remain risks. We cut EPS by a further 9-10% and retain SELL with a revised FV of Rs1,200 (down from Rs1,260).
Varroc Engineering (Reco: Reduce, FV: Rs. 550) - Another weak quarter
Varroc Engineering’s 4QFY26 EBITDA of Rs2.2 bn was 6% below our estimates owing to a weak revenue print. The company continues to grow the EV orderbook; we believe revenues will grow marginally ahead of industry growth owing to increased competitive intensity in key segments. We expect the company’s margins recovery to remain below expectations owing to increased competitive intensity, especially in the EV segment and the B2B nature of the business. Additionally, the overseas business should see gradual recovery led by new order wins across segments. Retain REDUCE with an FV of Rs550 (Rs590 earlier) based on 17X June 2028E consolidated EPS.
Siemens (Reco: Sell, FV: Rs. 2950) - Not as much localized; getting hit, finding it difficult to alter
SIEM’s segment profit declined 15% yoy against a similar revenue growth. Externalities are reflecting as vividly (maybe more) in case of peers on a low quantum base business margin, amplifying RM/FX overhang. SIEM shared difficulty in addressing the limited localization constraint that drives low quantum of base business margin. Analyst call suggests that the part of weakness in key metrics (order inflows, cash flows and margin) is driven by timing issues. That said, the result brings out the unpredictability in financials in times of market externalities, limiting case of rerating versus peers. We cut estimates by 7-9%, net of lower margin and higher DC estimates. Downgrade to SELL (from REDUCE) on expensive 79X/64X one/two-year forward EPS.
Mphasis - Mphasis investor day takeaways
We attended Mphasis investor day. Key takeaways are as follows—(1) management believes current AI trends will benefit Mphasis, (2) newly introduced Tria platform is capable of driving end-to-end modernization leveraging AI, (3) the business model will shift to platform + people model focusing on outcomes and (4) large deals team has helped Mphasis take better advantage of AI-led disruption. Retain REDUCE with an FV of Rs2,275.
ESG - Varun Beverages: CY2025 Annual Report analysis
Varun Beverages’ CY2025 Annual Report highlights (1) a 16.8% yoy increase in PBT to Rs40.1 bn, supported by government grants of Rs7.8 bn, one‑off items of Rs0.3 bn and forex gains of Rs2.3 bn; (2) forex gains are primarily driven by intercompany USD-denominated loans extended by VBL to its subsidiaries; (3) PepsiCo franchisee rights treated as having an indefinite life, amortization over life would lead to PBT for CY2025 being lower by 1.0%; (4) a decline in RoE to 16.9% on lower asset turns and a larger equity base post- QIP; and (5) FCF post interest turning positive at Rs5.2 bn, amid lower finance costs and a moderation in capex.
Real Estate (Sector View: Attractive) - Listed plays continue to grow, while industry remains subdued
Real estate sales for coverage companies in 4QFY26 grew 16% yoy, led by DLF and Oberoi, taking FY2026 pre-sales to Rs1.37 tn (+17% yoy)—modestly short of the 20% growth guidance. In contrast, industry sales grew by 5% yoy in FY2026, led by pricing growth of 8% yoy, even as volumes declined 3% yoy. Industry volumes have remained rangebound for three years in a row, while larger developers continue to grow through a combination of improving market share (15%, +150 bps yoy) and expansion to new geographies. Coverage players are targeting pre-sales of Rs1.6 tn (+17% yoy) for FY2027E on the back of launches worth Rs2 tn, even as stocks continue to factor a weak outlook. Valuation comfort, low growth expectations and liquid balance sheets keep us constructive, while we remain watchful of the ongoing geopolitical tensions and their impact on domestic demand.
Telecommunication Services (Sector View: Attractive) - TRAI April 2026 data: Vi holds the fort
TRAI’s April 2026 subscriber data shows Vi continuing to report marginal subscriber gains for the third consecutive month. Bharti leads net subscriber additions, driven largely by the M2M segment. The VLR gap between leaders widened mom to 1.1% (0.6 mom), as Bharti’s VLR ratio reached a multi- quarter high of 99.7%. MBB net additions remained robust at 7.2 mn, while FWA (including UBR) net additions remained muted at ~0.4 mn, led by Bharti’s performance. MNP requests rose to 14.7 mn (14.6 mom).
