5 ‘Buy’ recommendations by Jefferies with 30% to 54% upside potential

Jefferies has zeroed in on a mix of consumer, banking and financial stocks where company-specific triggers could shape returns over the coming period. The latest research points to Vishal Mega Mart’s rapid store expansion, improving retail formats and private-label business, while its banking calls are built around profitability, valuations and the varying impact of proposed insurance distribution rules.

Among the five stocks selected for this list, Vishal Mega Mart has the highest stated upside, while Axis Bank, State Bank of India, ICICI Bank Ltd. and IndusInd Bank also feature in Jefferies’ latest Buy-rated coverage. The brokerage’s calls come against a backdrop of strong credit growth and changing economics for bancassurance, making the individual catalysts different across the five names.

Vishal Mega Mart has the highest stated upside among the five stocks, with Jefferies retaining a ‘Buy’ rating and a target price of Rs 160, implying 54% upside. The brokerage sees the retailer’s expansion story extending well beyond its existing store base, with management targeting double-digit same-store sales growth in FY27.

The company currently operates 833 stores and sees a path towards around 2,000 stores over time. Its existing format can support more than 100 store additions annually, while smaller formats aimed at towns with populations of 40,000-50,000 are being piloted in Uttar Pradesh and Haryana. Jefferies said these formats could eventually expand the long-term store opportunity to around 4,000.

Store refurbishment is another growth lever. The brokerage said refreshed stores are generating sales increases of 10-15%, with some locations seeing increases of as much as 40%. The company has also launched Belong & Co, an urban youth-focused apparel format in Delhi.

Jefferies said, “VMM sees a clear path from 833 stores now to C2K stores over time, with existing format supporting 100+ annual store adds.”

Private labels remain another important part of the business model. They account for more than 60% of FMCG volumes and around 74% of general merchandise sales. Jefferies said strong volume growth of around 17-18% is providing operating leverage despite investments in quick commerce, RFID, artificial intelligence, warehouse automation and new formats.

Axis Bank has a ‘Buy’ rating from Jefferies with a target price of Rs 1,700, implying 36% upside. The brokerage estimates return on equity at 14% in FY27 and FY28, with the stock valued at around 1.5 times FY28 estimated adjusted book value.

The latest call comes as Jefferies assesses the potential impact of IRDAI’s proposed changes to insurance distribution regulations. The proposed framework could reduce commissions across several insurance categories, which would affect banks’ bancassurance income.

Axis Bank has relatively higher exposure than some of its peers, with FY26 bancassurance income equivalent to 9% of FY27 estimated profit in Jefferies’ analysis.

The brokerage said, “This will be tad negative for banks’ bancassurance fees, esp credit-protect premiums, as it’s mostly single premium with high commissions.”

Jefferies nevertheless retains its ‘Buy’ rating on Axis Bank, with the stock’s valuation and profitability forming the broader basis of its call.

State Bank of India carries a ‘Buy’ rating and a target price of Rs 1,320, implying 33% upside. Jefferies estimates ROE at 15% in FY27 and FY28 and 15% in FY29. The bank is valued at around 1.3 times FY27 estimated adjusted book value.

SBI has comparatively low exposure to bancassurance income. Jefferies’ analysis shows FY26 bancassurance income at around 2% of FY27 estimated profit, putting the lender among the banks with lower exposure to the proposed commission changes.

The brokerage said, “Based on FY26 banca commission/ FY27 profit (normalised), IIB and IDFCF have higher exposure, and ICICI and PSU Banks have lower risk.”

That relatively limited exposure gives SBI a different earnings profile from lenders where bancassurance contributes a larger share of profits. Jefferies has retained its ‘Buy’ rating with a Rs 1,320 target.

ICICI Bank has a ‘Buy’ rating with a target price of Rs 1,750, implying 31% upside. Jefferies estimates the bank’s ROE at 17% in FY27 and FY28, while FY28 estimated adjusted price-to-book is at 1.9 times.

The bank also has limited exposure to bancassurance income. Jefferies puts FY26 bancassurance income at around 1% of FY27 estimated profit, one of the lowest levels among the lenders covered in its analysis.

The brokerage said, “ICICI and PSU Banks have lower risk.”

Alongside the regulatory assessment, Jefferies’ Buy case for ICICI Bank rests on its profitability profile and valuation. The brokerage continues to include the lender among its Buy-rated private banks.

IndusInd Bank has a ‘Buy’ rating and a target price of Rs 1,250, implying 30% upside. Jefferies estimates ROE at 6% in FY27, rising to 9% in FY29, while the stock is valued at around 1.1 times FY27 estimated adjusted book value.

The proposed insurance distribution changes are particularly relevant for the lender because of its relatively high reliance on bancassurance. Jefferies estimates FY26 bancassurance income at 18% of FY27 estimated profit, the highest among the banks shown in its comparison.

Despite that exposure, Jefferies has retained a ‘Buy’ rating on IndusInd Bank and assigned a Rs 1,250 target price.

Sources: Jefferies research reports dated September 23-24, 2026.

What’s driving the Buy recommendation?

The five calls cover distinctly different earnings drivers. Vishal Mega Mart’s case is centred on store expansion, private-label penetration and operating leverage, while the banking picks reflect Jefferies’ assessment of profitability, valuations and exposure to the proposed insurance distribution changes. Within the banking group, the regulatory impact also varies materially because the contribution of bancassurance income differs from one lender to another.