JPMorgan has highlighted Coforge Ltd., Eternal Ltd., and Bharti Airtel Ltd. as its top overweight picks in the India TMT sector. These stocks are expected to deliver strong performance and growth, making them attractive investment options.
Coforge is the top overweight pick in the IT sector. The brokerage expects the firm to achieve a 21% organic constant currency revenue growth in FY26, driven by large deals such as Sabre. “We expect Coforge to be the fastest growing company in our IT coverage in FY26, with 21% organic CC revenue growth, while margins should see continued expansion,” JPMorgan stated.
The management remains bullish, with no signs of macro concerns affecting their outlook. The confidence stems from large deals won in FY25 and a strong pipeline, with expectations of achieving a 14% EBIT margin in FY26, ahead of its FY27 timeline. “Margins expansion will come from operating leverage benefits and lower ESOP costs,” the note added.
Eternal (Zomato) is JPMorgan’s top overweight pick in the internet sector. The brokerage expects Eternal to surprise positively on QC losses over the next couple of quarters, due to slowing store additions for all three players.
“Darkstore additions slowed down sharply for Blinkit-Instamart to 150 dark stores over 1Q25 and even slower for Zepto (30) at current trends, suggesting peak adds could be behind us,” JPMorgan noted.
High-frequency data points indicate a flat-lining of Zepto’s user numbers and declining paid ad downloads, suggesting reduced competitive intensity. This environment is expected to help Eternal’s Blinkit return to adjusted-Ebitda profitability sooner, the brokerage explained.
Bharti Airtel was JPMorgan’s top overweight pick in the telecom sector. The brokerage is optimistic about Bharti’s mid-teens Ebitda compound annual growth rate.
“We continue to like Bharti given it is one of the rare mega-cap stocks that provides a mid-teens Ebitda CAGR over the next three years,” JPMorgan stated.
The capex intensity is expected to reduce, with FY26 India capex projected to be lower than FY25 due to a slowdown in rural rollout and radio rollouts. Management plans to increase dividends as the balance sheet continues to deleverage. “We believe continued deleveraging and rising dividends should be the key catalysts for the stock outside of better than expected execution, 5G monetisation and tariff hikes,” the note concluded.
. Read more on Markets by NDTV Profit.These stocks are expected to deliver strong performance and growth, making them attractive investment options, according to JPMorgan. Read MoreMarkets, Business, Notifications
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