Motilal Oswal Identifies Top Stocks to Invest in Amid Market Volatility

The Indian markets are back in focus, given the massive bloodbath after the STT was hiked 150% in the Budget , and the huge volatility in the commodity prices impacted sentiment. What kinds of stocks do investors bet on at the moment? Motilal Oswal Financial Services has identified the top five Nifty stocks and key non-Nifty stocks that they expect to deliver strong returns in. Motilal Oswal’s top Nifty ideas are State Bank of India , Titan Company , Mahindra & Mahindra , Infosys , and Eternal (Zomato), as weakness persists and India underperforms global markets. Apart from these, Dixon Technologies (India) , Indian Hotels Company , Billionbrains Garage Ventures (Groww), TVS Motor Company , and Radico Khaitan are the top Non-Nifty 50 stock ideas. The Nifty is trading at a 12-month forward RoE (return on equity) of 14.9%, above its long-term average. In P/E terms, the MSCI India Index is trading at a 29% premium to the MSCI EM Index, below its historical average premium of 77%. About 50% of the constituents trade at a premium to their historical averages. Motilal Oswal listed out five companies trading at a significant premium to their historical averages- – Bharat Electronics is trading at 207% premium – Grasim Industries is trading at 61% premium – Hindalco Industries is trading 43% premium – Power Grid Corporation of India is trading at 35% premium – Oil And Natural Gas Corporation (ONGC) is trading at 33% premium Similarly, it has listed out 5 companies trading at a significant discount to their historical averages – Apollo Hospitals Enterprise is trading at 41% discount – Bharti Airtel (-30%), Trent (-27%), Dr Reddy’s Labs (-23%), and Maruti Suzuki India (-20%). However, the brokerage house expected a consolidation of recovery in earnings in the rest of FY26 and FY27 and raised its portfolio weights in large-cap names. Autos, Diversified Financials, Industrials & EMS, Consumer Discretionary, and Technology are Motilal Oswal’s key OverWeight sectors. In contrast, the brokerage is Underweight on Oil & Gas, Metals, and Consumer Staples. “We have also made several additions from a bottom-up perspective across the sector,” said Motilal Oswal. The domestic brokerage house sees the Indian equity markets in a favourable space with multiple market-supportive, growth-positive building blocks already in place. In CY25, India had to endure a constant flow of disproportionate and punitive US trade measures, which were instrumental in catalysing a $19 billion in FII outflows. However, the government and the RBI have been active in mitigating external headwinds. They both have adopted several stimulative fiscal, monetary, and reform measures to unshackle domestic growth impulses. Further, India and the European Union (EU) finally announced their years-in-the-making, multilayered free trade agreement (FTA), touted as a “mother of all deals”. While this opens up markets mutually for both economies from 2027 (after ratification and legal works), the full effects of the proposed deal will take a few years to fructify. “In our opinion, these measures should now start to manifest in full force in 2026, and we see limited domestic risk factors thwarting this. Our model portfolio broadly reflects our preference for growth visibility, structural domestic growth plays, and select global value names,” said Motilal Oswal. The Nifty ended 3.1% lower month-on-month (MoM) at 25,321 in January 2026, which was the second consecutive month of a decline. All major sectors ended lower. Some of the key losers are Real Estate (-11%), Consumer (-8%), Automobiles (-5%), Telecom (-5%), and Infrastructure (-5%) were the top laggards MoM. However, there are some that bucked the trend –Metals (+6%), PSU Banks (+6%), and Technology (+0.4%) were the only gainers.