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Top 3 Positional Stocks to Buy Now: Brokerage sees up to 21% return potential for investors

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  Published in Stocks and Investing on Monday, November 3rd 2025 at 9:18 GMT by Zee Business
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Top 3 Positional Stocks to Buy Now – Brokerage Sees Up to 21 % Return Potential for Investors

A recent market‑commentary published by Zeebiz highlights three positional stocks that brokerage analysts believe can deliver substantial upside for investors over the next 12–18 months. The research team, which focuses on medium‑term equities in India, estimates a potential return of up to 21 % for a well‑balanced portfolio comprising these three names. The recommendation is rooted in a blend of strong fundamentals, favourable valuation metrics, and sector‑specific growth drivers.

1. HDFC Bank (HDFCBANK)

Why it’s a positional pick

• Robust earnings trajectory – HDFC Bank has posted consecutive 10‑plus % year‑on‑year net profit growth over the past five fiscal years, buoyed by a steady expansion in both retail and corporate lending.
• Interest‑rate advantage – With India’s policy rate expected to rise gradually, the bank’s Net Interest Margin (NIM) stands to widen. Analysts project an NIM growth to 3.4 % in FY 2026 from 3.1 % in FY 2024.
• Credit quality – The bank’s non‑performing asset (NPA) ratio has consistently remained below 1 %, a testament to disciplined underwriting and strong risk management.

Valuation snapshot

• P/E – 21.8x (vs. sector average of 18.4x)
• PEG – 1.3 (suggesting upside relative to earnings growth)
• Target price – ₹1,800 (from current price of ₹1,520), implying a 18 % upside.

Key risks

• A slowdown in credit demand could compress growth.
• Rising competition from fintech‑enabled lenders may erode market share.

2. Bajaj Finserv (BAJFIN)

Why it’s a positional pick

• Diversified distribution – The company operates across retail, wholesale, and institutional finance. Its robust network of over 7,000 retail touchpoints gives it a competitive edge in consumer financing.
• Digital shift – Bajaj Finserv has accelerated its digital strategy, launching a customer‑friendly mobile app and leveraging data analytics for credit scoring. The digital arm is projected to grow at 30 % CAGR through FY 2027.
• High ROE – Return on equity has hovered above 20 % in the last three years, outperforming peers and reflecting efficient capital deployment.

Valuation snapshot

• P/E – 18.9x (slightly below the industry average of 20.5x)
• PEG – 1.2
• Target price – ₹1,150 (from ₹950), translating into a 21 % upside.

Key risks

• Regulatory tightening on consumer finance could cap growth.
• Interest‑rate volatility may impact loan profitability.

3. ITC Limited (ITC)

Why it’s a positional pick

• Premiumization trend – ITC’s diversified portfolio, including cigarettes, hotels, and FMCG, benefits from shifting consumer preferences toward premium products. The company’s flagship “Good Health” FMCG segment is expected to expand at 15 % CAGR.
• Cash‑flow strength – ITC consistently generates high free cash flow, enabling regular dividends and share buybacks. The dividend payout ratio stands at 35 %, offering a steady income stream.
• Resilience in cyclical downturns – The company’s stable pricing power and diversified revenue streams shield it from market volatility, making it a defensive pick within a growth‑focused triad.

Valuation snapshot

• P/E – 17.4x (sector average 19.6x)
• PEG – 1.1
• Target price – ₹1,050 (from ₹900), implying a 16 % upside.

Key risks

• Tobacco regulations and advertising restrictions could dampen cigarette sales.
• Hospitality downturn due to pandemic fallout may slow hotel revenue.

Supporting Analysis & Links

The brokerage’s research note cites a combination of on‑ground data and macro‑economic forecasts to underpin these recommendations. For deeper insight into each stock’s financials and growth dynamics, the article links to:

• HDFC Bank Annual Report 2023 – Detailed discussion of the bank’s credit strategy and margin outlook.
• Bajaj Finserv FY 2023 Earnings Release – Highlights on the company’s digital expansion and product mix.
• ITC Investor Presentation 2023 – Outlines the premiumization strategy and ESG initiatives.

Additionally, the research team references independent analyst reports and market sentiment indices that corroborate the favorable outlook for these equities.

Bottom Line

Investors seeking a mix of growth and stability can look at HDFC Bank, Bajaj Finserv, and ITC as the “positional” triad recommended by the brokerage. Each stock offers a distinct advantage—banking strength, fintech-enabled consumer finance, and premium consumer goods—while sharing common traits of robust earnings, solid credit risk profiles, and upside‑heavy valuations. If the brokerage’s projected 21 % return materialises, a diversified position in these three names could deliver both capital appreciation and income over the medium term.