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01 Oct 2025, 03:39PM

The high price of protection: A new fee that is holding America's tech future hostage

"Like other Trump schemes, this H-1B caper will backfire," wrote billionaire Silicon Valley investor Michael Moritz in the Financial Times. He argued that the new $100K fee for H1B visas shows a poor understanding of what makes US tech successful. Moritz warned that the high fee will simply push companies to move work to other global cities like Istanbul, Poland, or Bengaluru.

A single, dramatic policy change has challenged the long-held idea that the best talent must go to the US. For years, the H-1B visa has been the golden ticket for foreign workers, especially those from India, and kept the US tech industry at the forefront. Top US CEOs (including Trump supporter Elon Musk) first arrived in the US on the H1B visa and built some of the biggest tech companies in the world. Nearly one in five computer programmers and one in four scientists in the US are foreign-born. This pipeline of talent, crucial to the American economy, is now at serious risk.

But the H1B program has also been controversial. Companies claim they need it to hire people with specialised skills, but critics argue that it’s often used to bring in cheaper, mid-level workers earning modest salaries. Trump’s new executive order imposes a $100,000 fee on each H-1B worker, with the policy taking full effect in February 2026. For most firms, that price is impossible – only the richest tech giants could afford to bring in foreign talent at such high prices.

The proposal has split Silicon Valley. NVIDIA CEO Jensen Huang criticized it, saying, "We want all the brightest minds to come to the US – remember immigration is the foundation of the American Dream." In contrast, Netflix Co-founder Reed Hastings surprisingly supported the fee, calling it a "great solution" that makes sure the H-1B is "used just for very high value jobs" and gets rid of the uncertain lottery system. Interestingly, Netflix has only about 112 H-1B employees, indicating a lower dependence on the program.

In this edition of Chart of the Week, we will look at the possible fallout from the new $100,000 H-1B visa fee: how it prices out most talent, forces companies to offshore high-value jobs to India, and threatens to trigger a "reverse brain drain" away from the US.

New visa costs put most H-1B jobs out of reach

The new $100K H-1B fee makes the visa impractical for most jobs. Economists say a company would need to pay a salary of about $225,000 over three years to justify the expense. Yet, only about 5% of all H-1B job postings meet that salary level, meaning most applicants simply won’t qualify for the visa.

The impact is sharpest on big employers. Amazon, one of the largest users of H-1B visas, had just 4% of its 21,600 recent job postings above the $225,000 mark. IT staffing firms are hit even harder. TCS, India’s largest IT company, had no H-1B applications above the break-even point, with an average salary of $89,461. This shows how much they have relied on the mid-level roles that are now unaffordable.

Before this change, the typical H-1B cost about $10,000. The 10X jump, combined with the uncertainty of the lottery, is expected to cause applications to plummet. Experts believe companies will turn to offshoring or automation instead—signalling that the US is no longer the top destination for much of the world’s skilled talent.

Adapt and offshore: How Indian IT is navigating the fee hike

The new H-1B fee affects Indian IT companies in different ways. Many have already adapted to past US visa shocks, cutting H-1B filings by more than 50% in recent years to build a locally integrated workforce.

Indian companies have increased local hiring in the US—which now makes up over half of their US workforce—and shifted more work offshore. Together, they have invested over $1 billion in hiring and training staff in the US.

Still, the fee hike will hurt. The industry's traditional business model relied on a small team of skilled workers in the US to manage massive projects run by teams in India. The H-1B visa was the route for these on-site workers. Although these visa holders comprise a small fraction of the total workforce (around 3-5%), they are needed for winning and managing projects that generate substantial revenue.

The financial pain won't be immediate, but it is coming. Since the new fee applies only to fresh applications and not renewals, the real burden will be felt from 2027 onward. Analysts expect the hit to be modest for larger firms—about 0.3–1% on earnings per share. Shweta Rajani, head of mutual funds at Anand Rathi Wealth, noted, “Mid-cap IT stocks like Birlasoft and Persistent may see larger effects, but most large-cap companies can offset some costs through offshoring, local hires, or sharing costs with clients.”

Reverse brain drain: Skilled work moves to India

The proposed $100,000 H-1B visa fee could accelerate the relocation of high-value jobs to India. Faced with such a high cost of bringing top talent from their Indian offices to the US, major tech companies and global banks are realising it's much cheaper to expand their operations and hire directly in India. For them, it's a straightforward business decision.

This trend is already in motion. Citigroup, for example, recently moved nearly 1,000 tech jobs to its business centres in India, where it already has about 33,000 employees. Similarly, JPMorgan Chase has over 55,000 employees in India, and Goldman Sachs is also expected to rely more heavily on its Indian operations.

Ironically, a policy meant to protect American jobs may push even more skilled work out of the US. Analysts warn this could discourage global talent from coming to America, weaken its edge in innovation, and fuel a “reverse brain drain” that strengthens India’s tech ecosystem.

As former Tech Mahindra CEO CP Gurnani put it: “This (H1-B fee hike) hurts the US more than it hurts Indian companies, which have reduced their H-1B dependence by 60% in the last five years. In contrast, the dependence on H-1Bs has been going up for American counterparts. He also noted that they will do more offshoring, expand global capability centres (GCCs), and increase automation.

US big tech will also feel the pain. In FY24 ending September, Amazon, Microsoft, Meta, and Apple together received more approvals than the top seven Indian IT firms combined. That makes them especially vulnerable to the new fee, forcing them to lean more on their Indian GCCs, which are increasingly handling advanced R&D and product development.

Commenting on how financial giants are reacting, Abizer Diwanji of NeoStart Advisors noted that banks would be "calibrating a new strategy for the global capability centres." He added, “It appears there will be onshoring of jobs to India, adding new functions. However, none will rush decisions while the situation evolves. They will wait for more clarity.”

The Baseline

30 Sep 2025, 05:42PM

Five stocks to buy from analysts this week - September 30, 2025

By Ruchir Sankhla

1. Hindustan Aeronautics (HAL):

Motilal Oswal reiterates its ‘Buy’ rating on this defence company with a target price of Rs 5,800, an upside of 22.2%. Analysts Teena Virmani and Prerit Jain note that the company has secured a follow-on order worth Rs 62,400 crore from the Ministry of Defence for 97 Light Combat Aircraft (LCA) Mk1A.This new contract builds upon a previous order for 83 jets.

Production is now back on track. Management confirms that engine supply hurdles with General Electric (GE) are resolved, and deliveries of F404 engines have resumed. This clears the path for HAL to deliver the first two Tejas Mk1A aircraft by October 2025.

Analysts foresee strong long-term growth, fueled by a swelling order book and new homegrown systems, including advanced radar and electronic warfare tech. Key near-term catalysts include a technology transfer pact with GE for F414 engines, a potential collaboration on the Advanced Medium Combat Aircraft, and the expected government green light for a Rs 60,000 crore Sukhoi Su-30 aircraft upgrade.

Virmani and Jain project the company’s revenue will surge at a 24% compound annual growth rate (CAGR) through FY28 as manufacturing scales up. They also forecast net profit will climb at a 17% CAGR, supported by impressive margins of 27-30%.

2. Hindalco Industries:

Emkay upgrades its rating to ‘Buy’ on this aluminium products manufacturer with a target price of Rs 900, an upside of 18.1%. Analysts Amit Lahoti and Akhilesh Kumar believe the company’s US subsidiary, Novelis, has turned a corner on profitability. Operating margins are set to climb from $430 per tonne to over $500 by FY29 as the new Bay Minette project ramps up.

Hindalco boasts a major cost advantage, producing aluminium at just $1,700 per tonne compared to China’s $2,300 average. This efficiency generates immense cash flow, projected to hit Rs 30,000 crore annually from FY26-28. These funds will comfortably cover all planned capital investments.

Lahoti and Kumar see a compelling risk-reward scenario for aluminium. Tight supply and a weaker US dollar make the metal more attractive to global buyers. They have raised their near-term aluminium price target to $2,850 per tonne and expect prices to average $2,650–2,750, a trend that will lift earnings for producers.

3. City Union Bank:

ICICI Securities maintains its ‘Buy’ rating on this bank, with a target price of Rs 250, an upside of 17%. Analysts Jai Prakash Mundhra and Hardik Shah note the bank’s risk from the US textile export segment is minimal, with only Rs 220 crore in exposure, which management deems easily manageable. The bank’s total textile exposure is a modest Rs 1,500 crore.

Management is targeting an impressive 15-16% loan growth in FY26. This growth will be driven by gold loans, a rebound in its core small and medium enterprises (MSMEs) segment, and secure retail lending. The bank aims for a balanced portfolio of 50% MSME and 30% gold loans and expects to maintain a stable net interest margin of 3.5-3.6%.

With controlled risks, stable margins, and steady growth, analysts see City Union Bank as set for a strong run. Mundhra and Shah project compound annual growth of 16.5% in net interest income and 11.8% in net profit through FY27. The primary risk on the horizon is leadership succession, as the current CEO is set to step down in April 2026.

4. Cochin Shipyard:

ICICI Direct reiterates its ‘Buy’ rating on this shipbuilding company with a target price of Rs 2,240, an upside of 25.2%. Analysts Vijay Goel and Kush Bhandari believe its expertise in shipbuilding and repair skills, combined with a hefty order backlog, will power its long-term growth. They also predict healthy revenue growth as the company accelerates project execution.

The company recently supercharged its capabilities by commissioning a new dry dock and an international ship repair facility. This expansion dramatically increases its capacity, allowing it to handle larger and more complex projects and bringing its total capacity to 2.4 lakh deadweight tonnage (DWT).

Further expanding its footprint, Cochin Shipyard has partnered with Tamil Nadu's Guidance Agency on a Rs 15,000 crore plan to develop new shipbuilding clusters. The company is set to capture a wave of new orders in passenger and commercial shipbuilding, thanks to a strong pipeline and the government's push to upgrade maritime infrastructure.

Management confidently guides for 14-15% revenue growth in FY26, signaling steady execution ahead. Following this, Goel and Bhandari forecast the company will achieve a CAGR of 16.4% in revenue and 16.6% in net profit between FY26 and FY28.

5. KEC International:

Axis Direct maintains its ‘Buy’ rating on this infrastructure major, with a target price of Rs 1,030, an upside of 18%. Analysts Uttam Kumar Srimal and Shikha Doshi are bullish, citing the company's diverse, robust order book. Favourable trends in its core transmission and distribution (T&D) business are set to drive long-term growth.

The company's order book stands at Rs 33,398 crore, ensuring clear revenue streams for the next two years. Analysts note its core T&D business is firing on all cylinders, winning significant new orders from both domestic and international clients.

Expansion in the civil, railways, and cables segments is adding to the momentum. Government programs like the Jal Jeevan Mission and increased infrastructure spending are fueling demand in these areas. KEC is positioned to capitalise on these opportunities with its execution skills and global supply chain.

Management's focus on expanding its product range while cutting costs with AI could boost the bottom line. Srimal and Doshi project strong growth through FY27, forecasting a 15% CAGR in revenue, 32.2% in EBITDA, and 55% in net profit.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

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The Baseline

26 Sep 2025

The new H1B fee: Who will it hurt the most?

By Swapnil Karkare

For me, last week's H1B announcement hit very close to home. My cousin had flown to India from the US to renew her H1B visa just a couple of days before Trump’s surprise announcement of a $100,000 visa fee on H1B holders.

"It was a dreadful night," she says, describing the hours she spent glued to her phone, juggling calls with anxious colleagues and reading emails from her company's immigration lawyers. The confusion grew after news broke that Microsoft and Meta were asking their H1B employees abroad to return to the US within 24 hours.

"I thought—this is it. It’s over," she says. The possibility of her American life ending felt so real that she began browsing for apartments in Pune.

The White House later clarified that the H1B fee would be a one-time charge and would apply only to new visa applications, not renewals or current visa holders, so my cousin didn't have to find a Pune home after all. But the visa move is still a big shift in the US approach to skilled immigrants.

Journalist Menaka Doshi pointed out that the steep hike in H1B visa fees was something Elon Musk, a former H1B recipient himself, pushed for.

Indian nationals account for the vast majority of H1B visas — 71% of those approved in 2024. So, many saw this move as part of a larger pattern of the US administration's moves against India, after Trump’s friendship with Modi soured.

But do H1B visas actually take jobs from Americans? If we look beyond Trump's claims and the fear-mongering from US right wingers, the numbers say the opposite.

Let's kill some myths, shall we?

The software sector drove demand for H1B

The U.S. technology sector is a global magnet for talent, and for years the H1B visa program has been the bridge bringing in skilled workers into the US from across the world. Computer-related jobs have accounted for more than half of all approved H1B petitions. Many leaders of top US tech companies, including the CEOs of Microsoft and Google, once held H1B visas themselves.

H1B has created American jobs, and driven up wages

The narrative — that H1B workers steal American jobs — is full of holes, if we look at the actual data. The National Foundation for American Policy’s (NFAP) research shows that a 1 percentage point increase in H-1B workers within an occupation actually leads to a 0.2 percentage point decrease in US unemployment.

H-1B workers don't just fill existing vacancies; they help create more jobs in the broader system for their American colleagues. They also increase the earnings of US workers by 0.1-0.26 percentage points. By bringing complementary skills, they make their American peers more productive.

Multiple studies have confirmed this positive wage effect, showing that H-1B talent and U.S. workers are not in competition, but often part of the same growth engine.

Importing talent became an easy way to boost US innovation

Beyond jobs and wages, H-1B workers significantly improve US innovation and productivity. Researchers at Stanford University found that between 1976 and today, foreign nationals contributed 25–30% of all U.S. patents, and immigrant college graduates increased nationwide patenting by 12–21% from 1940 to 2000.

Below is a picture of the US physics team, that just won all five gold medals at the International Olympiad in Paris this week. All the contestants - Agastya Goel, Allen Li, Joshua Wang, Feodor Yevtushenko, Brian Zhang - are children of immigrants.

Increased H-1B visa levels are linked to more new products, which in turn leads to higher company revenue. Startups that hire H-1B workers are also more likely to attract funding from venture capital or IPOs: research found that companies with a 100% win rate in the H1B lottery were more likely to get external funding within three years, compared to companies that didn't win any visas.

The startups hiring these workers could be tomorrow's large employers. Such access to world-class talent is a crucial factor for the long-term health of American tech companies.

The impact on the US government's revenues is nothing to sneeze at either. The 3 million H-1B visa holders in the US contribute over $85 billion annually in income taxes, along with $25 billion annually to Social Security and Medicare - programs that many of them will never benefit from. It would not be entirely wrong to say that, in effect, they’re subsidising the retirement and healthcare of American workers.

Finally, there’s the multiplier effect. H-1B professionals are not just workers — they’re also consumers. They spend on housing, transportation, education, and local businesses, injecting billions of dollars into communities across the US. This spending drives demand across multiple sectors, indirectly creating even more jobs for Americans.

Self-goal? The impact of the fee will be felt more in the US rather than India

The irony is that shutting the door on H-1Bs doesn’t necessarily mean more jobs for US citizens. A Wharton School study showed that for every 10 H-1B visas lost by top multinational firms, nine jobs are moved abroad. In practice, H1B is often a choice between keeping the foreign worker in the US or abroad.

With 66% of the US companies outsourcing at least one department, the US already sends about 300,000 jobs overseas every year. The H-1B program helped slow this trend by keeping skilled workers and those jobs in America.

Restrictive H-1B policies do more harm than good. The Federal Reserve Bank of Richmond estimates that even a 10% reduction in high-skilled immigrant workers would shrink the US economy by $86 billion. That’s a staggering cost for a policy aimed at "protecting American workers". Good politics is not necessarily good economics.

Some Indian firms have cut their H-1B filings by more than 50% in recent years. H-1B workers for the top 10 Indian and India-centric companies are less than 1% of their entire employee base. "Given this trajectory, we anticipate only a marginal impact for the sector," Nasscom says.

The visa fee may only encourage more offshoring. Global capability centres (GCCs), set up by multinationals in India already handle a lot of business processes, from basic data crunching to complex R&D. They include US tech firms, European pharma companies, and global automobile majors. The number of GCCs has grown from 700 in 2010 to more than 1,700 in 2024, employing nearly 2 million people.

Even industry veterans are calm. CP Gurnani, former MD & CEO of Tech Mahindra, called the fee hike a “temporary shock” and reassured that it would not affect customer deliveries in any way.

Focus ought to be on fixing fraud

That’s not to say the H-1B program is flawless. There are undeniable operational and governance-level issues that deserve attention.

Take wages, for example. A major case study of HCL Technologies revealed “widespread wage theft,” where the company systematically paid H-1B workers far less than comparable US employees — despite having attested to fair pay. The Economic Policy Institute estimates this practice alone costs workers about $95 million annually.

Fraudulent practices have also crept into the system. One such abuse is “multiple registration,” where staffing firms submit dozens of lottery entries for the same applicant to tilt the odds. Bloomberg estimates that 15,500 visas last year — one in six — were won this way. Over four years, a single operator used a dozen shell companies to enter candidates up to 15 times, securing hundreds of H-1Bs while genuine candidates lost out.

The White House’s 2025 fact sheet flagged that while tech firms demand more visas, unemployment among recent US computer science and engineering graduates has reached 6.1% and 7.5%, respectively — more than double the jobless rate for biology or art history majors. But this effect may have more to do with artificial intelligence hitting entry level jobs, and over-hiring during the Covid years.

When countries start doing fear-based politics, it is usually a sign that the government in question has run out of ideas. Trump probably thinks he has played a great hand, but he may not be reading his cards right.

As always,

The Trendlyne team

The Baseline

26 Sep 2025

Five Interesting Stocks Today - September 26, 2025

By Trendlyne Analysis

1.Garden Reach Shipbuilders & Engineers (GRSE):

This Kolkata-based shipbuilding player rose 1.3% on September 24 after the Cabinet approved a Rs 69,725 crore package for the shipbuilding and maritime sector. The package provides financial support and subsidies that will lower the cost of building vessels, helping Indian shipbuilders compete better globally.

The company entered into five memorandum of understanding (MoUs) last week with major players in shipbuilding, ports, and infrastructure, such as Indian Port Rail & Ropeway and Shipping Corp of India. These agreements cover a range of projects across building green vessels, ship repair, port development, logistics, and ropeway connectivity. In addition, it finalised a $62 million (Rs 547 crore) deal with Germany’s Carsten Rehder to deliver four hybrid multi-purpose vessels.

As of the end of June 2025, the company’s order backlog was a substantial Rs 21,700 crore, with about 84% coming from the defence shipbuilding segment. GRSE anticipates strong execution in FY26 and FY27, fueled by the final phase of two major contracts — P-17A and ASW-SWC — which make up nearly 70% of the order book. While these projects provide clear revenue visibility, analysts caution that timely awarding of new contracts will be key for growth beyond FY27.

Looking ahead, Chairman & MD P.R. Hari said, “We expect to complete the majority of our orders in the next two years. We are also preparing for the P-17 Bravo project, worth about Rs 70,000 crore, for which bids are expected to be invited by 2026.” But he noted that outsourcing costs (expenses for work done by external contractors) are likely to be around 15% of revenue in the coming quarters, as the company rides through its peak revenue phase.

ICICI Direct maintained its ‘Hold’ rating for the company, acknowledging the significant opportunities in the defense shipbuilding space. The brokerage noted that contracts like next-generation Corvettes, worth about Rs 25,000 crore, have already been approved by the government and are expected to be awarded to the company by the end of FY26. They project a revenue CAGR of 35% and a net profit CAGR of 28% over FY26–27.

2. Minda Corporation:

This auto component manufacturer’s stock jumped over 8% on September 24 after it unveiled its “Vision 2030” roadmap. Chairman and Group CEO Ashok Minda outlined plans to transform the company into a “system solutions provider,” with a focus on electrification, premiumisation, and exports. The company set an ambitious revenue target of Rs 17,500 crore by FY30, up from Rs 5,056 crore in FY25.

Management also guided for higher profitability, with the EBITDA margin expected to rise 110 basis points to 12.5% by FY30. The company plans to increase its revenue contribution from passenger vehicles to 25% (currently 14%), while reducing its reliance on 2/3-wheelers to 40%. To fund growth, Minda has lined up Rs 2,000 crore of capex over the next five years.

Group CTO D. Suresh highlighted research priorities that move beyond mechatronics toward electronics and software. The company is investing in advanced driver assistance systems (ADAS), cybersecurity, software-defined vehicles, and EV electronics. With annual R&D spending of about 4% of revenue and a portfolio of more than 310 patents, Minda says that it is backing its growth vision with “steady innovation”.

Exports are another key pillar, with the company aiming to nearly double their contribution to revenue by 2030. It plans to grow export sales at a CAGR of 37% to Rs 1,500 crore by FY30. To achieve this, Minda has formed joint ventures with global partners for automotive switches and smart cockpit electronics, targeting the connected-vehicle market.

Minda Corporation appears in a screener of stocks where brokers upgraded their recommendation or target price in the past three months. Axis Securities maintains its Buy call with a target price of Rs 690. The brokerage highlights the company’s strong revenue trajectory, margin expansion plans, and disciplined capex execution. It flagged premiumisation, higher exports, and EV component growth as long-term structural drivers.

3. Jindal Stainless (JSL):

The stock of this iron & steel products company rose 3.5% over the past week after it unveiled a massive expansion plan. On September 19, the company signed an agreement with the Maharashtra government to establish a new stainless steel plant in Raigad. The project, valued at Rs 41,580 crore, is expected to create around 15,500 jobs.

This investment comes at a favorable time for the company. The government recently introduced a temporary 12% safeguard duty on certain steel products, a move praised by Chairman Ratan Jindal. He said that this measure will protect Indian manufacturers from unfair competition, particularly from China and Vietnam, and help boost domestic production.

The company's recent performance has been solid, with its latest Q1FY26 net profit climbing 10.2% compared to last year, driven by efficient inventory management. Revenue also rose by 8.4%, supported by strong sales volumes. However, Trendlyne Forecaster expects a marginal 0.9% revenue growth in the next quarter due to US tariff uncertainties and potential swings in the prices of raw materials. The stock features in a screener of companies which have given consistent high returns in the past five years.

Company leadership remains confident in its strategy. Management confirmed its investment plans are on track, having already spent Rs 665 crore in the first quarter out of a total Rs 2,700 crore capex planned for the fiscal year. Addressing concerns about US tariffs, Managing Director Abhyuday Jindal emphasized that their priority is the booming domestic market. "Exports aren’t a priority," he said, "and will be considered only if attractive opportunities arise."

Looking at the big picture, brokerage firm ICICI Direct sees significant room for growth. India’s average steel consumption per person is currently just half the global average. With domestic demand projected to grow steadily until 2030, JSL, as the country's largest producer, is perfectly positioned to benefit. The brokerage has assigned a ‘Buy’ rating with a price target of Rs 940.

4. Oil & Natural Gas Corporation (ONGC):

This exploration & production player’s stock has climbed by 1% in the past week on its plans to acquire 2.5-3 gigawatts (GW) of renewable energy projects by 2030. This move will more than double the company's current clean energy capacity of 2.5 GW.

Earlier this year, ONGC, which supplies about 70% of India’s oil and gas, announced a goal to build a 10 GW renewable energy business by 2030. About 60-70% of this will come from solar, with the remaining 30-40% from wind energy. To fund this, the company has set aside a Rs 1 lakh crore investment for its green portfolio.

ONGC has already moved quickly on its acquisition strategy. Through its subsidiary, ONGC Green, it purchased 288 MW of wind assets from PTC Energy. It also secured another 4.1 GW of clean energy capacity through a joint venture with NTPC Green (which included assets from Ayana Renewables).

This move is part of ONGC's strategy to diversify its business. The plan centers on strengthening its main oil and gas operations while also expanding into regasified liquefied natural gas (R-LNG), renewable energy, and petrochemicals.

At the same time, ONGC is boosting its core exploration business. Vivek Tongaonkar, the Director of Finance, said, “We have planned a capital expenditure of around Rs 35,000–40,000 crore for FY26, with a significant portion directed towards exploration and production projects”.

ONGC currently has 25 major projects in the pipeline, representing an investment of Rs 74,474 crore.

The brokerage firm Geojit PNB Paribas highlights the company’s focus on valuable partnerships, innovation driven by sustainability, and its strategy of diversifying its business. The firm gives the company a ‘Buy’ rating with a target price of Rs 270. It believes that increasing production, turning projects into profit more quickly, and benefits from recent discoveries will all boost performance.

5. Swiggy:

This internet & catalogue retail company fell 5.7% over the past week after its board approved the sale of its stake in bike/taxi aggregator, Rapido, for Rs 2,400 crore on September 23. MIH Investments One BV will acquire a stake worth Rs 1,968 crore, while Westbridge will buy a stake worth Rs 431.5 crore.

Speaking on the divestment in Rapido, Swiggy’s CEO, Harsha Majety, said, “When we got in two and a half years back, Rapido was a mobility player. Unfortunately, they decided to get into food delivery themselves. We took note of the conflict, and therefore are planning to go our separate ways.”

While the fund infusion from Rapido is positive, analysts remain concerned about the company's cash burn rate. Swiggy is estimated to have a net cash outflow of Rs 1,000 crore in Q2FY26, following a Rs 2,800 crore outflow over the past two quarters. The stake sale will bolster the company’s depleting cash balance only for the next few quarters.

In another strategic move, Swiggy's board approved the transfer of its quick commerce business, Instamart, to a wholly-owned subsidiary via a slump sale at a book value of Rs 2,976.7 crore on September 23. The restructuring is expected to be completed by Q3FY26 and could enable Instamart to switch to the inventory-led model once Swiggy becomes an Indian Owned and Controlled Company (IOCC) with a domestic shareholding above 51 per cent. Switching to an inventory-led model will improve the contribution margin of the Instamart business.

Reflecting these sentiments, Kotak Institutional Equities downgraded Swiggy to 'Reduce' from 'Add', setting a target price of Rs 430. The brokerage cited the significant quarterly cash burn, calling the fund infusion a "stopgap," and noted that Swiggy may need additional fundraising to meet its ongoing cash requirements.

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations

The Baseline

25 Sep 2025

Indices at a glance: Biggest winners and losers over the past year

By Divyansh Pokharna

India’s equity market has been a tale of contrasts. The Nifty 500 slipped 2.9% over the year as foreign investors pulled back funds, rattled by global tariffs, moving capital to less expensive markets like China.

However, the last six months painted a different picture. The market bounced back, with the Nifty 500 climbing 11.5%. This turnaround was largely thanks to Indian investors who poured money into the market through regular investment plans and institutional funds. Government spending on big projects in infrastructure and defense also gave a significant boost to companies in those sectors. This recovery points to strong local investment and government policies balancing out global economic challenges.

Digging deeper, we see a divided market. Sectors like defence and electric vehicles (EVs) delivered impressive returns, while media and IT stocks struggled. According to Kotak Institutional Equities, this proves that simply having a steady flow of money into the market doesn't guarantee that it will rise. The firm advises investors to go back to basics and focus on a company's earnings and true value, rather than just relying on investment trends.

In this edition of Chart of the Week, we track the performance of sectoral and group indices over the past year. The analysis shows gains in defense, EV, and quality-focused indices, with steep declines in IT, media, utilities, and Tata Group indices.

Defence and EVs lead the charge

Two of the year's biggest success stories were the Nifty India Defence and the Nifty EV & New Age Automotive indices, which shot up by 33.1% and 25.7% respectively. The government's "Make in India" push has increased demand for locally made defense gear, benefiting companies like Hindustan Aeronautics, Bharat Electronics, and Mazagon Dock..

Similarly, the production-linked incentive (PLI) scheme has helped car manufacturers like Mahindra & Mahindra and Eicher Motors expand their electric vehicle lines. Mahindra has launched new EV models, while Eicher has rolled out electric trucks. Over the past year, Mahindra & Mahindra's stock has risen by 22.5%, and Eicher has seen a 40.8% jump, with government support and shifting consumer tastes powering India’s EV market.

Smart picks: How quality and strategy boosted gains

Aside from investing in specific themes, three other market indices delivered solid returns by focusing on smart diversification and strong company fundamentals. The Nifty500 Equal Weight, the Nifty Smallcap250 Quality 50, and the Nifty India New Age Consumption indices saw gains of 25.5%, 23.5%, and 24.4%, respectively.

The Nifty500 Equal Weight index has a simple but effective strategy: it treats all 500 companies it tracks equally, no matter their size. This approach lessens the impact of a few giant corporations, giving smaller, faster-growing companies a chance to shine.

Another standout was the Nifty Smallcap250 Quality 50 index. This index is made up of smaller companies that are profitable, have steady earnings, and low debt. This focus on quality benefited companies like eClerx Services and Manappuram Finance, which rose by 62.7% and 38.6% over the last year. The index's success is even more impressive when compared to the broader Nifty Smallcap 250 index, which actually fell 4.2% during the same period.

Finally, the Nifty India New Age Consumption index tracks how people's spending habits are changing. It includes companies in areas like real estate, digital services, and travel—the kinds of things people spend on as their incomes grow. The success of companies such as Vishal Mega Mart and Paytm shows this shift toward online shopping and premium experiences.

Together, these three indices show that there are many paths to strong returns. Instead of just chasing high-growth sectors, they suggest that spreading investments widely, picking financially healthy companies, and paying attention to consumer trends can also lead to big gains while managing risk.

The laggards: IT and media face disruption

On the flip side, the BSE IT Sector fell by 17.9%. A slowdown in the global economy led clients in the US and Europe to cut back on technology spending, which hurt major players like TCS and Infosys. The rapid rise of artificial intelligence has also created new challenges, forcing these companies to rethink their business strategies.

The Nifty Media index fared even worse, dropping 23% as it struggled to adapt to the digital age. Traditional advertising revenue from TV and newspapers is drying up as audiences move to streaming services, and movie theaters are facing tough competition from on-demand platforms. The failed merger between Zee and Sony added to the sector's problems, impacting companies like Zee Entertainment, PVR INOX, and Sun TV Network.

For both IT and media, the main problem is relying too heavily on old business models. The IT industry's outsourcing services are being challenged by AI, while traditional media is losing out to digital content. Without major changes, a quick recovery for these sectors looks unlikely.

Heavyweights underwater: Utilities, power, and Tata Group lag behind

The S&P BSE Utilities index fell 18.3% over the past year, largely due to heavy losses in Adani Group companies.

Although the Securities and Exchange Board of India (SEBI) recently dismissed the Hindenburg allegations, which caused a recent rally in Adani stocks, Adani Group shares are still down for the year. Companies like Adani Green Energy and Adani Energy Solutions have dragged down the entire utilities sector.

Similarly, the BSE Power index dropped 19% as the sector's growth slowed. Beyond the issues with Adani, other major companies also stumbled. Thermax, for example, faced problems with project execution and shrinking profits. These issues made the power sector less appealing to investors, who turned their attention to booming areas like defense and infrastructure.

The Nifty Tata Group 25% Cap index also saw a significant drop, falling 17.1%. Some of the group's biggest names, including Tata Motors, Trent and TCS, pulled the index down. Tata Motors was hit by a slowdown in its Jaguar Land Rover unit due to weaker demand and trade pressures, while TCS felt the effects of the global cutback in IT spending.

The Baseline

23 Sep 2025

Five stocks to buy from analysts this week - September 23, 2025

By Abdullah Shah

1. Bharti Airtel:

Geojit BNP Paribas maintains its ‘Buy’ rating on this telecom provider, with a target price of Rs 2,123, an upside of 9.5%. Analyst Gopika Gopan attributes the positive outlook to the company's significant expansion in its fixed wireless access (FWA) and home-pass networks.

In Q1FY26, Bharti Airtel's revenue grew 28.6% YoY to Rs 49,971.4 crore, fueled by strong performance in the Indian market and a recovery in Africa. Growth in India was driven by steady performance in mobile and home services, with an average revenue per user (ARPU) of Rs 250. Net profit surged 43% YoY to Rs 5,947.9 crore due to lower access charges. The company also added 7 lakh postpaid customers during the quarter, bringing its total base to 2.7 crore.

Gopan highlights that the company's portfolio premiumisation and continued growth in 5G shipments will drive performance across all segments. She adds that its focus on acquiring high-quality customers and expanding its fibre and FWA networks will be catalysts for margin growth. She expects revenue and net profit to grow at a CAGR of 16.7% and 25.2%, respectively, over FY26-27.

2. Jindal Stainless:

ICICI Direct reiterates its ‘Buy’ rating on this iron/steel products manufacturer with a target price of Rs 940, indicating an upside of 17.4%. Analysts Shashank Kanodia and Manisha Kesari cite industry tailwinds and capacity expansion as key drivers for long-term growth. They also expect margin expansion from a richer product mix, and increased backward integration.

Analysts note that India's stainless steel demand is projected to grow at a 7% CAGR to 6.5 MTPA by FY30, driven by applications in the automotive and process industries. Additionally, emerging sectors like green hydrogen, nuclear energy, and defence offer demand visibility. The company is well-positioned to capitalise on this growth, with plans to establish a 1.2 MTPA melting shop in Indonesia by FY27, lifting total capacity to 4.2 MTPA.

Kanodia and Kesari highlight the management's focus on expanding its downstream capacity with new hot-rolled and cold-rolled processing lines in Odisha. The acquisition of a 0.6 MTPA cold rolling mill in Gujarat and a joint venture for a 2 lakh MTPA nickel pig iron plant are also expected to improve margins. Analysts expect the company to deliver revenue, EBITDA, and net profit CAGRs of 9.2%, 12.2%, and 16.3% respectively, over FY26-28.

3. Prince Pipes & Fittings:

Motilal Oswal retains a ‘Buy’ rating on this smallcap plastic pipes & fittings manufacturer with a target price of Rs 440, an upside of 27.6%. Analysts Meet Jain and Sumant Kumar expect medium-term growth to be driven by new capacity in Bihar, expansion of the chlorinated polyvinyl chloride (CPVC) business, and rising demand in tier-2/3 markets. They also forecast margin expansion from higher utilisation and a richer product mix.

While management acknowledges Q2 is a seasonally weak quarter, it anticipates a recovery in H2FY26. This rebound is expected to be driven by inventory restocking, GST-related demand for building materials, and increased consumption. The company plans to commission a new facility in Bihar by the end of H1FY26, adding 45-50 kilotonnes per annum of capacity and strengthening its foothold in the high-potential East India market.

Analysts believe the company is well-positioned to increase its market share in the CPVC business, supported by its partnership with Lubrizol for CPVC compounds. Additionally, government schemes like PMAY (Housing for All) are expected to drive demand over the medium term. Jain and Kumar forecast the company to deliver revenue, EBITDA, and net profit CAGRs of 14.4%, 45.8%, and 100% respectively, over FY26-27.

4. GR Infraprojects:

Axis Securities maintains its ‘Buy’ call on this infrastructure company with a target price of Rs 1,540, an upside of 19.7%. Analysts Uttam Kumar Srimal and Shikha Doshi believe the company is poised for growth, citing the government's strong push for infrastructure as a key driver for FY26. They expect this national focus on capital expenditure and public-private partnerships to enhance connectivity and drive economic growth.

The company's order book of Rs 19,179 crore in FY25, supplemented by Rs 5,166 crore in lowest-bidder projects, provides strong revenue visibility. With 30 active projects nationwide, analysts highlight the company's proven execution capabilities and effective project management.

GR Infraprojects is actively diversifying beyond its core roads and highways portfolio into sectors like railways, tunnels, ropeways, and power transmission. It is also exploring new opportunities in multi-modal logistic parks, airport runways, and renewable energy projects.

Srimal and Doshi anticipate a robust bidding pipeline in engineering, procurement, and construction (EPC) and hybrid annuity model (HAM) projects to drive strong order intake. Consequently, they forecast the company will deliver a revenue and net profit CAGR of 12.5% and 8.4% over FY26-27.

5. Abbott India:

Sharekhan retains its ‘Buy’ rating on this pharmaceutical company, with a target price of Rs 34,470, an upside of 14%. Analysts believe a strong distribution network, continued expansion into tier-II & III cities, and a healthy product pipeline will fuel topline growth.

In Q1FY26, Abbott India's revenue and net profit both grew 11.5% YoY. Strong brand performance and marketing initiatives drove revenue growth, while lower raw material costs bolstered profitability. Underscoring its innovation, the company has launched over 100 products in the last 12 years, positioning it for sustained performance through a mix of legacy brands and new offerings.

Analysts identify the company's strong brand recall as a key growth driver, supported by the upcoming marketing and distribution of Novo Nordisk's GLP-1 in India, which should provide a near-term catalyst. Sharekhan forecasts the firm’s revenue and net profit to deliver a CAGR of 9.4% and 12.6% over FY26-27E, respectively.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

(You can find all analyst picks here)

The Baseline

19 Sep 2025

Five Interesting Stocks Today - September 19, 2025

By Trendlyne Analysis

1. Inox Wind:

This wind turbine manufacturer rose 1.9% in the past week and over 8% in the last month. This came after Axis Direct highlighted the company’s balance sheet transition following its merger with Inox Wind Energy, a former unit of its renewable energy business. This merger contributed to a sharp liability reduction of Rs 2,050 crore, with the company's net debt falling from Rs 2,956 crore in FY24 to Rs 809 crore in FY25.

In FY25, borrowings were significantly reduced through several actions. The company fully redeemed non-convertible debentures (NCDs) of Rs 1,075 crore, leaving no debentures outstanding as of March 2025. Additionally, an equity infusion of Rs 2,300 crore across the parent company and its subsidiaries was partially used to pay down long-term debt.

Axis Direct described FY25 as a ‘turnaround year’ for Inox Wind. During this period, revenues more than doubled, and the company reported a net profit of Rs 438 crore, a significant improvement from the loss recorded in FY24. The company's order book now stands at a record 3.1 GW, providing clear revenue visibility for the next two to three years. The company appears in a screener of newly affordable stocks with strong financials and a good Durability score.

The company is in expansion mode, and has opened a new facility in Ahmedabad, and started backward integration for cranes and transformers. Its operations and maintenance (O&M) division now manages 5.1 GW and has also entered the solar O&M sector.

In Q1FY26, its revenue grew 36% YoY but missed Forecaster estimates by 8% due to lower-than-expected project execution. The company executed 146 MW during the quarter, a 4% increase YoY but a 38% decrease from the previous quarter. Despite this, CEO Sanjeev Agarwal remains optimistic, saying, “We are confident of achieving guidance of executing 1,200 MW for FY26 and 2,000 MW for FY27.”

To meet this goal, the company must deliver 1,054 MW in the remaining nine months of the fiscal year, a significant increase from the 565 MW completed during the same period last year. Agarwal raised EBITDA margin guidance for FY26 to 18–19%, from an earlier forecast of 17–18%, projecting improvement from backward integration.

2. JBM Auto:

This auto components manufacturer surged more than 10% on September 12 after its subsidiary, JBM Ecolife Mobility, secured a $100 million investment from the International Finance Corporation (IFC), part of the World Bank Group. The funds will finance the rollout of 1,455 electric buses across Maharashtra, Assam, and Gujarat under the PM e-Bus Sewa scheme.

The company’s financial health showed strong momentum in Q1FY26, with revenue climbing 12% YoY and net profit growing by over 10%. EBITDA margins were robust at 14%, an improvement over both the previous quarter and the same period last year. Vice Chairman and MD Nishant Arya said, “We aim to maintain this margin with better asset utilisation amid a strong order book and many bus deliveries scheduled this year.”

Fueling this growth is JBM’s order book, which stood at Rs 45,000 crore at the end of FY25. A significant boost came in February when the company won a substantial order worth nearly Rs 5,500 crore for 1,021 e-buses under the PM e-Bus Sewa programme. This pushed the company's e-bus backlog to over 7,000 units, providing a multi-year revenue visibility for its OEM division. Arya noted that the company is also seeing “a strong demand for buses from private players.”

While the component business remains JBM Auto’s foundation, contributing over 55% of consolidated revenue from high-volume sheet metal parts, the company is shifting gears. It is transitioning into a complete vehicle manufacturer, with its OEM division primarily focused on electric buses, which now accounts for roughly 35% of revenue. This share is set to climb as the company executes its large-scale public transport orders. The tool room and other engineering businesses make up the rest of its revenue.

Currently, exports account for about 5% of its revenue, but the company has plans to double its export share to 10% in FY26. It is targeting markets across Europe, the Asia-Pacific, the Middle East, and Africa. With this expansion, Arya anticipates the company will achieve double-digit revenue growth in FY26, projecting revenues between Rs 6,000 and Rs 6,500 crore.

3. Hyundai Motor India:

Thisvehicle manufacturer has surged 6.8% since September 17, following its signing of a three-year wageagreement with the United Union of Hyundai Employees. Investors interpreted the agreement as a signal of stable labour relations and predictable workforce costs, reducing the risk of production disruptions.

The agreement covers nearly 2,000 employees from FY25-27, giving them a clear plan for pay raises over the next three years. More importantly, it locks in the company’s workforce costs, removing a major headache. This gives the company room to ramp up production and prepare for its EV expansion in India.

On September 18, Hyundaiannounced that India will get its first locally designed electric vehicle before 2030, built with a 100% local supply chain. Their plant in Pune is set to become an export hub, adding 2.5 lakh cars to Hyundai’s worldwide production by 2030, making India a key market for both domestic sales and exports.

However, total sales in Augustdropped by 4% YoY due to a 11% decline in domestic sales. Analysts attribute this decline to the recent GST reform, as buyers delayed purchases. The company said that 60% of its internal-combustion engine (ICE) portfolio now falls under the 18% tax slab from 28%, following the GST reduction on small cars with a length of up to 4 metres.

Tarun Garg, COO,noted that post-cut, “The SUVs in the sub-4 metre segment will see the highest growth, as that segment represents both affordability and aspiration.”

Despite the dip in total sales, its monthly exports rose 21%. Gargsaid, “Our goal is to establish India as a manufacturing base for emerging economies and to become Hyundai’s largest export hub outside South Korea.”

Motilal Oswalmaintains its ‘Buy’ rating, citing that the company is set to benefit significantly from the GST rate cut and strong rural demand. The brokerage expects the company to register modest 2% growth in FY26. However, they believe the ramp-up of the new Pune plant and upcoming launches will likely drive Hyundai Motor’s volume up by 15% in FY27.

4. Ambuja Cements:

The stock of this cement & cement products company rose 3.9% over the past week as a wave of optimism swept across the Indian cement sector. Global brokerage firms HSBC and CLSA turned bullish, with HSBC naming the company one of its top picks, expecting it to dominate the industry’s expansion in FY26. CLSA sees industry profits growing thanks to stable pricing, cost-saving measures, and recent tax cuts.

Adding to this positive sentiment, the company’s parent, Adani Cement, has welcomed the government's recent decision to slash the GST on cement from 28% to 18%. CEO Vinod Bahety believes the move will speed up national infrastructure projects and boost the economy. Analysts predict this tax cut could cause cement prices to fall by Rs 25-30 per bag, a direct benefit for consumers.

The company’s own performance is already showing strength. In its latest Q1FY26 results, net profit surged by 21.9% compared to last year, thanks to better inventory management. Revenue also grew 21.7%, beating the Forecaster estimate by 5.2%, due to a 3% price hike of cement bags during Q1. The stock features in a screener of companies which have shown relative outperformance versus industry over the past week.

To meet future demand, the company is aggressively expanding its capacity. Mr. Bahety confirmed they have added 5 million tonnes of capacity in the last three months and plan to add another 13 million tonnes this financial year. With a current capacity of 104.5 million tonnes, the company is on a clear path to reach 118 million tonnes by the end of FY26, as part of its larger goal of hitting 140 million tonnes by FY28 through strategic expansions at various sites.

Looking forward, brokerage firm Ventura highlights the company's commitment to innovation through its “Adani Cement FutureX” research and development initiatives. The firm believes the company is positioned to capitalize on India's infrastructure boom through its twin strategy of expansion and cost control. Ventura has issued a ‘Buy’ rating on the stock with a price target of Rs 794.

5. NCC:

The share price of this construction & engineering player increased by 4.2% over the past week. NCC secured an order worth Rs 2,091 crore from Bihar’s Water Resources Department to construct the Barnar Reservoir. This project includes building a dam and irrigation channels.

In August, NCC’s water division bagged two orders totalling Rs 788 crore, adding to a series of major contract wins in recent months. In June, its building division announced new orders worth Rs 1,691 crore, along with a Rs 2,269 crore contract for Metro Line 6 from MMRDA, covering rolling stock, signalling, telecom, and depot machinery.

Neerad Sharma, Head of Strategy at NCC, said, “With these new orders, our order inflows have reached ~Rs 9,600 crore, which translates to 43% of the full-year guidance of Rs 22,000–25,000 crore.” While the buildings segment currently accounts for 79% of the work, the management expects increased contributions from the transportation, irrigation, and mining sectors in the upcoming quarters

The company’s June quarter performance showed signs of pressure. Net profit fell 8.4% YoY to Rs 192.1 crore, while revenue declined by 6.3% to Rs 5,179 crore. This weaker performance was attributed to slower project execution, caused by an early monsoon and delays in starting some large projects.

However, the company expects a recovery in Q2 as execution picks up with improved weather and necessary site clearances. NCC is also targeting significant infrastructure opportunities in Andhra Pradesh, including tenders for capital city development and general infrastructure expansion.

ICICI Securities maintains a ‘Buy’ rating on the company with a target price of Rs 262. The brokerage is confident that NCC’s strong order pipeline will allow it to meet its financial guidance comfortably, forecasting a full-year revenue growth of 15% with margins holding around 9%.

Trendlyne's analysts identify stocks that are seeing interesting price movements, analyst calls, or new developments. These are not buy recommendations

The Baseline

18 Sep 2025

Bull run fizzles out: Multibagger count in Indian equities falls

By Tejas MD

Almost a year has passed since the Nifty 50 touched its all-time high on September 27, 2024. Back then, the market looked unstoppable, breaking records week after week, and every investor felt like a stock-picking genius.

A year later, the thrill is gone. The market has cooled, and investors check their portfolios the way Bangaloreans check traffic on Google Maps—cautiously, knowing it’s rarely good news.

Superstar investor Vijay Kedia summed up the market sentiment: “I have never held more cash in my portfolio now than in my entire life. It is going to stay this way as long as the uncertainty remains.”

With the markets in neutral, we take a look at the multibagger trend. Are there sectors quietly defying the broader weakness?

Let’s dive in.

A fading bull run: Multibagger count in Indian equities sinks to record lows

A year ago, the Indian stock market was on a roll. The Nifty 50 kept climbing until it hit an all-time high in September 2024, and investors saw a flood of “multibaggers”— stocks that had at least doubled in value in just a year.

By April 2024, one in three Nifty 500 stocks had delivered multibagger returns, and investors were enjoying one of the broadest market rallies in years.

Multibagger count in Nifty 500 sinks to multi-year lows in September

But fast forward to September 2025, and the momentum has all but disappeared. For three straight months, the count of new multibaggers has stayed in the single digits—a sharp contrast to last year’s frenzy. Today, only two names from the Nifty 500 make the multibagger cut: JSW Holdings and Waaree Energies.

Only two Nifty 500 stocks remain in the multibagger club

These two stocks are among the rare stocks that have posted multibagger returns in an otherwise quiet market. JSW Holdings is riding on the strong performance of its group companies, while Waaree Energies, listed in October 2024, has gained from investors betting on the rising demand for solar power equipment.

These are the exceptions, not the rule.

The number of multibaggers also declined across the entire stock universe, not just among Nifty 500 stocks.

Sharp decline in number of multibaggers across the stock universe

In the broader market outside the Nifty500, Bsome sectors continue to produce multibaggers. Banking and finance, commercial services & supplies, and textiles now account for 40% of all multibaggers.

Banking and finance stocks dominate multibaggers across stock universe

Banking and finance dominate this group. Recent RBI data shows that bank credit grew 9.5% YoY in Q1FY26, while deposits expanded by 10.1%, easing funding pressures for lenders. As a result, 49 out of 320 multibagger stocks belong to this sector, making it the single largest contributor.

Signs of caution: weaker market sentiment

Several market indicators highlight the shift in sentiment. By September 2025, both one-year and quarterly median returns for Nifty 500 stocks turned negative.

Median year change of Nifty 500 stocks drops sharply

More than half of Nifty 500 companies are now trading at least 20% below their 52-week highs. This gap widened sharply in April this year as markets fell, narrowed in July during a partial recovery, but has barely improved since.

Over half of the Nifty 500 stocks are trading 20% below their year highs

A brief summer rally offered hope that a recovery was underway, but it quickly fizzled out.

A year ago, the typical stock was 66% above its year-low. Today, it’s hovering just 30% higher, much closer to the ground. In fact, 38 companies are still trading near their year lows, highlighting a weakness that is both deep and widespread.

38 stocks from Nifty 500 trade near their year lows vs six last year

From vanishing multibaggers to stocks trading far below their peaks, the market has clearly shifted from confidence to caution. Investors aren’t chasing rallies anymore—they’re holding their breath and watching every policy move.

The focus now is on trend-changing events: a breakthrough in US-India trade talks, stronger-than-expected earnings in the September quarter, or a festive spending surge fueled by GST cuts. Any of these could bring the bulls back into play.

The Baseline

17 Sep 2025

From gems to gadgets: India’s $24 billion leap into global smartphone manufacturing

By Divyansh Pokharna

The next iPhone 17 you unbox might not say "Made in China," but "Made in India," assembled at the Tata group’s facility in Tamil Nadu or Foxconn’s plant in Karnataka. As India becomes the world’s new smartphone manufacturing hub, these names are now part of the global supply chain that was once dominated by a single country – China – signalling a big shift in manufacturing.

For decades, India's exports were defined by traditional products like refined petroleum and precious gems. Now however, India’s mobile phone exports have skyrocketed from a mere Rs 1,500 crore in FY15 to Rs 2 lakh crore in FY25. This meteoric rise has, for the first time, placed smartphones among India's top exported goods. As these exports grow, the US has exempted Indian electronics from tariffs.

A study by the Centre for Development Studies (CDS) notes that while China increasingly focuses on high-end components and design, “India has an opportunity to become the next major global hub for electronics manufacturing, particularly in assembly.”

A key driver of this success is the government's Production-Linked Incentive (PLI) scheme. Its principle is simple: the more a company produces and exports, the more it earns in incentives. The policy has been effective, attracting cumulative investments of Rs 12,390 crore and creating over 1.3 lakh jobs as of mid-2025.

Despite this progress, challenges remain. India is still heavily dependent on components like display panels and batteries imported from China. And while India became the world’s third-largest mobile phone exporter in 2024, its $20.5 billion in shipments is a fraction of China's $135 billion. To close this gap, India must move beyond assembly and build a complete ecosystem encompassing design, R&D, and component manufacturing.

In this edition of Chart of the Week, we explore how government policy and a global supply chain shift are boosting India’s mobile phone exports and local champions like Dixon and Tata. The other part is to look at the hurdles like high costs and competition from Vietnam that will shape India's smartphone manufacturing future.

'Make in India' opens the door to electronics wins

The ‘Make in India’ push, backed by the PLI scheme, has made the country an attractive destination for global electronics giants. The strategy has also benefited the government financially: between FY21 and FY24, it generated Rs 1.1 lakh crore in revenue while paying out about Rs 5,800 crore in incentives. Global players like Foxconn and Pegatron have ramped up production, while Tata Electronics has become a major force by acquiring parts of Wistron and Pegatron’s Indian operations.

It's not just global players setting up shop; local champions are rising to the occasion. Dixon Technologies has emerged as a star performer. Once known for assembling TVs and basic phones, the company now manufactures smartphones for heavyweights like Samsung, Motorola, and most recently, Google (Pixel). Now, this consumer electronics firm is taking the next logical step: making components. It is investing around Rs 1,000 crore to produce camera modules, fingerprint sensors, and other key parts with global partners, reducing India's reliance on imports.

Atul Lall, Vice Chairman and MD, said, “We expect a strong order book ahead of the festive season to drive 40-45% revenue growth this year. A large part of the contribution will still be coming for mobiles.” He added that margins this year should be similar to those of last year, but will start to expand as the new components business is integrated into the system.

Ultimately, global tech giants are flocking to India for four simple reasons: rising domestic demand, government incentives, competitive manufacturing costs, and the push to diversify supply chains beyond China.

The hidden challenges of India's global rise

Despite its rapid growth, India's manufacturing ambitions face roadblocks. A primary hurdle is high logistics costs, which eat up 13–14% of the country's GDP—nearly double the rate in developed economies. While this is better than rival Vietnam's 18%, it's comparable to China's, which stands around 14.1%. Delays at ports, poor last-mile connectivity, and inefficient warehousing continue to hamper efficiency. India aims to reduce these costs to 8-9% by 2030.

An unexpected brain drain presents another complex challenge. Foxconn recently pulled hundreds of Chinese engineers and technicians from its Indian facilities, a move prompted by Beijing's pressure to restrict technology and talent exports to India. While this won't hurt the quality of the phones, it could slow down production. As Bloomberg noted, "Extraction won't impact the quality of production, but it’s likely to affect efficiency on the assembly line.”

Finally, India faces stiff competition and internal challenges. Rivals like Vietnam have a head start due to their mature electronics ecosystems and free trade agreements, which make their exports more competitive. Domestically, India struggles with a shortage of highly skilled workers, a heavy reliance on imported key components such as displays and chips, and a maze of complex regulations that can create friction for businesses.

India's iPhone boom defies global trade wars

Global trade tensions are rewriting the manufacturing map. While the US has imposed steep tariffs on many Indian goods, the iPhone remains a notable exception. To maintain this, Apple CEO Tim Cook made a strategic move, pledging $600 billion in US investments to safeguard the company's rapidly expanding manufacturing base in India.

However, this commitment isn’t about shifting iPhone assembly back to the US. Most of that investment is reportedly for data centres, not factories. Cook has openly admitted that the US lacks the skilled workforce for intricate assembly. A fully American-made iPhone could cost anywhere between $1,500 to $3,500. In India, that same phone rolls off the line for around $1,200, keeping it affordable for the world.

This India-centric strategy is paying off. Despite global trade uncertainty, India shipped $7.5 billion worth of iPhones in just the first four months of FY26—nearly a third of the total for the entire previous year.

However, the ultimate challenge for India is to move beyond just being an assembly line. The long-term game is about building a complete ecosystem for components, semiconductors, and design. Without this crucial step, India remains vulnerable to global political shifts, while its rivals, such as Vietnam, continue to strengthen their own electronics supply chains

The Baseline

16 Sep 2025

Five stocks to buy from analysts this week - September 16, 2025

By Abdullah Shah

1. Sagility India:

Geojit PNB Paribas maintains its ‘Buy’ rating on this healthcare services company, with a target price of Rs 55, an upside of 23%. Analysts believe that the company is strategically positioned to benefit from growing Medicare utilisation from US clients. They also expect margins to expand, backed by automation and cost controls.

In Q1FY26, Sagility's revenue and net profit grew 24.1% YoY to Rs 1548.8 crore, marginally beating Forecaster estimates. Steady growth across its payer and provider segments drove revenue growth. Net profit surged 6.7x YoY to Rs 148.6 crore during the quarter due to a low base in Q1FY25. Sagility won $32 million (~ Rs 281.7 crore) in new contracts from both existing and new clients during the quarter. Management has maintained its FY26 organic growth guidance in the low-to-mid teens, with overall growth projected to be above 20%.

Analysts note that the company’s strong order pipeline, focus on non-discretionary spending, higher-margin offshore delivery, and a seasonally stronger second half will drive revenue growth. They add that the acquisition of BroadPath Healthcare Solutions will create cross-selling opportunities and support future growth. The analysts expect the firm’s revenue and net profit to deliver a CAGR of 18.4% and 33.3% over FY26-27, respectively.

2. Metro Brands:

Emkay reiterates a ‘Buy’ rating on this footwear retail company with a target price of Rs 1,475, an upside of 14%. Analysts Devanshu Bansal and Sunny Bhadra believe that the recent goods & services tax (GST) reduction and an improving outlook for its affordable footwear brand, Walkway, will lead to strong growth across formats. They also anticipate margin gains from operating leverage on recent tech investments and a margin turnaround in the sportswear brand, FILA.

Analysts highlight that the recent GST reduction to 5% on footwear priced under Rs 2,500, which constitutes about 40% of Metro's sales, could increase its topline by 3% and EBITDA by 7% in FY26. The company launched a new premium crossover range and an outlet-store format, Shoe Depot, to cater to consumers seeking discounts.

Bansal and Bhadra note that management is focused on the high-growth sports and athleisure (S&A) segment through exclusive partnerships with FILA and Footlocker, which have the potential to become Rs 1,000 crore brands. They expect Metro Brands to deliver a CAGR of 15.9% for revenue, 18% for EBITDA, and 18.8% for net profit over FY26-28, respectively.

3. Waaree Renewable Technologies:

Ventura initiates a 'Buy' rating on this renewable energy company, with a target price of Rs 1,416, an upside of 29.6%. Analysts highlight that global demand for solar engineering, procurement, and construction (EPC) is rising due to net-zero pledges, falling solar costs, and India’s plan to add 500 gigawatt (GW) of renewable capacity by 2030. Domestic opportunities are also strong, with annual rooftop tenders exceeding 70 GW, and schemes like PM-KUSUM and Surya Ghar expanding the market.

Management reports that the company currently operates with approximately 15 GW of solar module capacity and 5.4 GW of solar cell capacity, with plans to expand module capacity to 25.7 GW. The revenue per megawatt stands at Rs 1.1 crore and is expected to remain stable or improve, depending on the project specifications. They expect EBITDA margins of 14-15% in FY26, below the 19.5% achieved in FY25.

Analysts note that the company’s near-term margins are under pressure due to intense price competition, faster tender cycles, and volatile solar module costs. They expect revenue to grow at a 53% CAGR by FY28, with EBITDA rising at 50% and margins to ease slightly due to scale and competition.

4. Krishna Institute of Medical Sciences (KIMS):

ICICI Direct retains its ‘Buy’ call on this healthcare company with a target price of Rs 875, an upside of 15.6%. Analysts Siddhant Khandekar and Shubh Mehta believe the company is well-positioned for growth through a regional expansion into high-earning geographies.

They highlight that the company's strong presence in Andhra Pradesh and Telangana will be strengthened by a planned 1,270-bed addition over the next two years. The firm is shifting its payor mix toward cash and insured patients to improve average revenue per occupied bed and margins in Andhra Pradesh.

KIMS is also expanding into new regions like Maharashtra and Karnataka, using a combination of greenfield projects and acquisitions. Two new hospitals in Bengaluru are expected to become operational in Q2FY26, adding a combined 800 beds.

Khandekar and Mehta expect KIMS’ revenue and net profit to deliver a CAGR of 26.2% and 31% over FY26-27. This growth is expected to be driven by the ramp-up of new hospitals, particularly in Thane, and the addition of new facilities in Karnataka. They add that the management's unique merger & acquisition strategy, including a doctor equity partnership model, should help successful acquisitions and clinical alignment.

5. VRL Logistics:

Motilal Oswal reiterates its ‘Buy’ rating on this small-cap logistics company with a target price of Rs 350, an upside of 23.4%. Analysts Alok Deora and Shivam Agarwal note that VRL’s price hikes in June 2024 (8-10%) helped push realisations up by 17% YoY in Q1FY26, though transport volumes fell 13%. EBITDA rose 74% with a margin of 20.4%, driven by lower fuel costs, reduced lorry hire charges, and improved truck procurement.

The company expects volumes to remain flat in FY26 but guides for 7-8% growth in FY27. Realisations are expected to hold steady, with no further hikes planned unless input costs rise. Analysts highlight that the government’s recent cut in Goods and Services Tax across commodities should support a recovery in demand.

Deora and Agarwal mention that the company’s strong position as one of India’s largest fleet owners, supported by its in-house maintenance infrastructure and a cautious approach to expanding into new regions, has helped the company maintain margins even when volume growth is weak. They expect revenue, EBITDA, and net profit to grow at a CAGR of 6%, 10%, and 19% respectively, over FY26-27.

Note: These recommendations are from various analysts and are not recommendations by Trendlyne.

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