Today, we recommend two stocks, one from the construction sector and another from the capital goods sector, as recommended by the Trade Brains Portal, for an upside potential of more than 25%. The Indian construction industry plays a vital role in the country’s economic growth, recording an 8.6% output increase in FY25 and surpassing a market size of USD 1 trillion, making it the third-largest construction market globally.
Meanwhile, India’s capital goods sector is key to industrial growth and economic development, supporting large-scale manufacturing and infrastructure projects. We also analyzed the market’s performance on Wednesday to understand what may lie ahead for the stock indices in the coming days.
1. Honeywell Automation India Ltd
- CMP: ₹ 36,175
- Target: ₹ 42,850
- Upside: 18.9%
- Time frame: 12 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
Honeywell Automation India Ltd, founded in 1984, is a prominent technology and manufacturing company headquartered in India. It operates as part of the global Honeywell group, catering to diverse industries across multiple regions. The company’s growth is aligned with three major global trends: automation, the evolving aviation sector, and the transition to sustainable energy. It operates under a single business segment, which is Automation and Control Systems. As of March 31, 2025, the company employed 3,140 full-time staff.
In FY25, Honeywell Automation India Ltd recorded operating revenue of Rs 4,189.6 crore, marking a 3.2% increase over the previous year, with an adjusted growth rate of 10.1%. Revenue from the domestic market stood at Rs 2,427 crore, showing a marginal rise of 0.4% compared to Rs 2,417.8 crore in the prior year.
Export revenue reached Rs 1,754.6 crore, up 7.2% from Rs 1,637 crore last year. The company’s New Orders book saw a year-on-year growth of 14.1%. Net profit for the year was Rs 523.6 crore, reflecting a 12.5% return on sales.
In Q1 FY26, the company reported a revenue of Rs 1,183 crore compared to Rs 960.4 crore in Q1 FY25, a 23% growth YoY. And the net profit stood at Rs 124.6 crore. The company benefits from operations in Building Solutions and BMS offerings from Industry Trends, such as India’s infrastructure sector growing at 8% CAGR.
Further, initiatives like Make in India and PLI benefit the Process Solutions and Sensing Solutions segments. Additionally, 500 GW of non-fossil capacity and produce 5 MMT of green hydrogen annually by 2030 supports company solutions in process automation, battery storage, EV safety sensors, and green hydrogen control technologies.
Moreover, it is well-positioned for growth, especially with the increase in government funding for critical infrastructure sectors such as airports. railways and hospitals. Coupled with a surge in private investments in emerging industries, including data centers, semiconductor factories, Li-ion battery manufacturing, and solar panel production, there are ample opportunities for the company to showcase its expertise.
Risk Factor
The company is subject to geopolitical risks, which have the potential to disrupt the global economy and drive up trading and logistics costs. It is also vulnerable to fluctuations in foreign exchange rates, with significant volatility expected in the Indian rupee against major currencies due to ongoing geopolitical developments. Additionally, the company operates in a highly competitive Indian market, facing growing pricing pressures across both domestic and international segments. Rising competition from local startups and global firms could affect its revenue and profit margins.
2. K E C International Ltd
- CMP: ₹ 861.95
- Target: ₹ 1,085
- Upside: 25.9%
- Time frame: 12 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
KEC International Ltd., established in 1945 and part of the RPG Group, is a global EPC player headquartered in Mumbai, operating in over 110 countries with a workforce of more than 7,500 employees. The company operates across six key sectors: Transmission & Distribution (T&D), Civil, Transportation, Pipelines, Renewables, and Cables.
With eight manufacturing facilities globally and strong in-house design capabilities, KEC executes complex projects such as power transmission lines, metro systems, oil & gas pipelines, and solar power plants. As of Q1 FY26, the company’s total order book, including L1 positions, stands at over Rs 40,000 crore.
In Q1 FY26, KEC reported a revenue of Rs 5,023 crore, reflecting an 11% YoY growth from Rs 4,512 crore in Q1 FY25. Profit after tax surged 42% YoY to Rs 125 crore from Rs 88 crore. The T&D segment was a key growth driver, contributing 63% to total revenue, up from 55% last year, with segment revenues rising 26% YoY to Rs 3,157 crore.
The company secured over Rs 3,200 crore in new orders across India, the Middle East, and the Americas, and commenced expansion at its Butibori tower manufacturing facility, following successful upgrades in Dubai, Jaipur, and Jabalpur. Its order book and L1 pipeline in T&D now stand at approximately Rs 26,000 crore. EBITDA margins improved by 50 bps to 7.0% in Q1 FY26, with future guidance of 8%-8.5% for FY26 and 9%-9.5% for FY27. Interest expenses also declined to 3.0% of revenue, down 40 bps from 3.4% in Q1 FY25.
The civil business achieved a strategic breakthrough by entering the semiconductor EPC segment with a large, first-of-its-kind order from a reputed client. Meanwhile, the renewable segment posted 87% growth with revenues of Rs 136 crore, supported by two ongoing 500 MW solar projects in Karnataka and Rajasthan; Karnataka is partly commissioned, while Rajasthan’s first phase is due this quarter.
The company is actively bidding for solar, wind, and BESS projects, aiming to achieve Rs 3,000-4,000 crore in renewable revenues over the next 2-3 years. Strong momentum continues in the T&D segment, driven by renewable energy expansion and emerging opportunities in digital substations, STATCOM, and HVDC technologies, with a promising outlook across key international markets, including the Middle East, Africa, CIS, and the Americas.
Risk Factor
KEC International faces several risks, including high working capital intensity inherent to the EPC sector due to long project execution cycles. With 63% of its revenue from the highly competitive T&D segment, both in India and abroad, the company’s margins are vulnerable to raw material price volatility, especially for fixed-price international contracts. Additionally, its global operations expose it to currency fluctuations, counterparty credit risks, and geopolitical uncertainties, all of which could impact execution timelines and profitability.
Market Recap 08/10/2025
On Wednesday, the Nifty 50 opened on a slightly negative note at 25,079.75, down -28.55 points from its previous close of 25,108.30. It touched an intraday low of 25,008.5 before closing near the 25,000-mark at 25,046.15, down by -62.15 points, or -0.25%. Technically, the index remained above all the 20/50/100 & 200-day EMAs on the daily chart. The BSE Sensex also reflected a similar trend, opening at 81,899.51, down -27.24 points from its previous close of 81,926.75. It traded in a similar pattern to the Nifty 50 and settled below the 81,800 level at 81,773.66, losing -153.09 points, or -0.19%.
Momentum indicators showed moderate strength, with the RSI for Nifty 50 at 53.75 and for Sensex at 54.08, both well below the overbought level of 70. Also, the Bank Nifty Index closed in negative territory, losing -221.1 points, or -0.39%, to end at 56,018.25. The broad indices declined after rallying for four consecutive sessions on Wednesday, driven by global market uncertainty with heightened caution as the US Government shutdown extends into its second week.
The Nifty IT Index topped among the sectoral gainers, closing at 35,232.25, up 522.8 points or 1.5%. Major IT stocks, including Infosys Ltd, TCS Ltd, Coforge Ltd and LTIMindtree Ltd, gained up to 2.5%. The Nifty Consumer Durables Index followed next, with 270.75 points or a 0.7% gain, to close at 32,236.20.
The shares of Titan Company Ltd gained the highest, with a 4.3% increase, followed by Cera Sanitaryware Ltd and Century Plyboards Ltd, which rose by up to 1.5%. The Nifty India Digital Index also gained on Wednesday, closing at 9,122.55, up 42.7 points or 0.5%.
The Nifty Realty index was the major loser, declining by -16.3 points or -1.8%, closing at 875.4. Anant Raj Ltd, Oberoi Realty Ltd, and Signature Global Ltd all fell by up to -4.9%. The Nifty Media Index followed the decline, closing at 1,555.95, down -27.15 points, or -1.7%. Prime Focus Ltd dropped -3.4%, while other media stocks like Zee Entertainment Ltd, Nazara Technologies Ltd and DB Corp Ltd slipped by up to -2.9%. The Nifty Auto index also fell -411.15 points or -1.5%, closing at 26,522.4.
Asian markets showed mixed sentiment on Wednesday. Hong Kong’s Hang Seng Index lost -128.31 points, or -0.48%, to close at 26,829.46. Japan’s Nikkei 225 Index declined by -215.89 points, or -0.45%, ending at 47,734.99, and Singapore’s Straits Times Index decreased by -15.96 points, or -0.36%, ending at 4,456.3.
Markets in China and South Korea remained closed for the day. As of 4:54 p.m. IST, US Dow Jones Futures were trading at 46,959, up 108 points, or 0.23%, ahead of Federal Open Market Committee (FOMC) minutes for the September meeting.
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