Today, we recommend two stocks, one from the financial services sector and another from the oil and gas sector, recommended by the Trade Brains Portal, to buy for an upside potential of more than 36%. India’s economic progress, which is largely dependent on the financial sector, is a key factor of stability in the global economy. India’s financial services industry has experienced huge growth in the past few years.
This momentum is expected to continue. Meanwhile, the oil and gas sector is crucial for India’s economic growth, energy security, and industrial development, supplying essential fuels for transportation and power and acting as a feedstock for numerous industries. We also analyze the market’s performance on Friday to understand what may lie ahead for the stock indices in the coming days.
1. REC Ltd
- Current price: ₹ 381
- Target price: ₹ 520
- Upside: 36.48%
- Time frame: 12 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
One of the leading “Maharatna” enterprises, Rural Electrification Corporation Limited (REC Ltd.), was founded in 1969 and is registered as a Non-Banking Finance Company (NBFC), Public Financial Institution (PFI), and Infrastructure Financing Company (IFC). REC provides funding for all aspects of the power-infrastructure industry, including generation, transmission, distribution, and renewable energy. Furthermore, REC provides funding for innovative technologies such as green ammonia projects, battery storage, pump storage, electric vehicles, and green hydrogen.
REC has diversified into the non-power infrastructure sector, which includes IT communication, ports, highways, expressways, metro rail, airports, and electro-mechanical (E&M) projects related to different industries, including refineries and steel. The company’s disbursements grew by 18% annually from Rs 1,61,462 crore in FY24 to Rs 1,91,185 crore in FY25.
In FY25, the business had its highest-ever loan book of Rs 5.67 lakh crore, up 11% year over year, and its highest-ever earnings of Rs 15,713 crore, up 12% year over year. Net interest income increased by 27% to Rs 19,878 crore, while asset quality is rising sharply. The overall income grew by 19% annually at Rs 55,980 crore. In FY25, the company’s earnings per share were Rs 59.55, but it paid out a total of Rs 18 in dividends per share, a 180% increase.
The company’s NIM increased 6 basis points year over year to 3.63% in FY25 and is expected to range between 3.5% and 3.75% in FY26. The company anticipates disbursing 2-2.1 lakh crore in FY26 and reaching Rs 10 lakh crore at a 12% CAGR by FY30. Prepayments are expected to remain at around Rs 1 lakh crore annually, with the transmission and smart metering project providing an opportunity of Rs 1.1 lakh crore over the next two to three years.
By 2030, the company, whose book value is currently Rs 58,000 crore, intends to invest Rs 3 lakh crore in renewable energy. The five-year-long Revolving Bill Payment Facility sanctions are expected to pay out between Rs 80,000 and Rs 90,000 crore in FY26. EPC contracts are complete, and FY26 will see an increase in payments.
In Q1 FY26, the company reported a rise in Net Interest Income by 17.27% YoY, to Rs 5,247 crore from Rs 4,474 crore during Q1 FY25. Its Net Profits increased by 29% YoY, from Rs 3,442 crore in Q1 FY25 to Rs 4,451 crore in Q1 FY26. The company recorded the highest loan book during the quarter at Rs 5.85 lakh crore, as against 5.30 lakh crore in the previous year. Its gross credit-impaired assets increased to 1.05%, whereas net credit-impaired assets improved to 0.24%.
Risk Factor
The company is particularly vulnerable to client concentration risk; clients with unstable financial standing, such as state power firms, pose a threat to the company, as it holds 87% of the total loan book as of March 31, 2025. The company is also vulnerable to shifts in technology, laws, and consumer behavior.
2. GAIL Ltd
- Current price: ₹ 171
- Target price: ₹ 230
- Upside: 34.5%
- Time frame: 12 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
GAIL (India) Limited, India’s leading natural gas company, was established in 1984 as a Maharatna PSU. The company is involved in trading, transmission, LNG regasification, petrochemicals, city gas distribution, exploration and production (E&P), and the production and transmission of LPG, making it a key player across the natural gas value chain. GAIL holds a significant market share in India: 15% in polyethylene (petrochemicals), 70% in gas transportation, and 50% in gas trading. The company currently operates 16,420 km of natural gas pipelines.
In FY25, GAIL reported sales of Rs 1,42,291 crore, marking a 7% increase from Rs 1,33,499 crore in FY24. Profit after tax rose by 26% year-on-year to Rs 12,462.87 crore. For FY26, management expects earnings before tax to touch at least Rs 4,500 crore. During FY25, GAIL achieved record annual volumes in petrol gearboxes at 127 MMSCMD and LPG gearboxes at 4.478 MMTPA. It also entered into a long-term agreement with Qatar for 0.75 MMTPA, with supply commencing in April 2025. In addition, the KLL Dabhol Breakwater project was completed.
Gas transportation volume is projected to increase to 138-139 MMSCMD in FY26. On April 18, 2025, the Ministry of Petroleum and Natural Gas (MOPNG) allocated GAIL an additional 0.32 MMSCMD of well gas for LPG production, offsetting over half of the previous APM decline. This is expected to enhance both productivity and profitability.
As of Q1 FY26, natural gas transmission stood at 121 MMSCMD, petrochemical sales at 177 TMT, liquid hydrocarbon sales at 198 TMT, and LPG transmission at 1,131 TMT. The company reported a gross turnover of Rs 35,369 crore, with net profits of Rs 2,369 crore. For FY25-26, capital expenditure is projected at Rs 10,700 crore.
Risk Factor
GAIL has entered into several long-term LNG import contracts where the pricing is primarily linked to the Henry Hub (HH) index, the US benchmark for natural gas. This pricing structure exposes GAIL’s marketing margins to fluctuations in international gas prices. In the event of a decline in crude oil prices, the company’s profitability may come under pressure.
Market Recap 8th August, 2025
The Nifty opened Friday’s trading session on a bearish note at 24,544.25, lower than the previous close of 24,596.15. It touched a low of 24,337.50 during the day and ended at 24,363.30, falling below both the 20-day, 50-day, and 100-day EMAs. By the close, the Nifty 50 had dropped -232.85 points, or -0.95%.
The BSE Sensex mirrored this trend, declining by -765.47 points, or -0.95%, from its opening of 80,478.01 to settle at 79,857.79. The Nifty 50’s RSI fell to 33.58, while it still held above the 200-day EMAs. The BSE Sensex RSI also dropped to 33.23, staying well below the overbought level of 70. Although it slipped below the 20-day, 50-day, and 100-day EMAs, it managed to close above the 200-day EMAs.
This market decline was attributed to the US government imposing an additional 25% penalty on top of 25% tariffs on Indian exports, persistent foreign investor selling, and global economic uncertainties. Market volatility increased as the India VIX rose by 0.43 points, or 3.68%, to close at 12.12.
Almost all major indices declined on Friday. The Nifty Realty Index was among the major losers, closing at 874.15, down -18.85 points, or -2.11%. Godrej Properties Ltd was the biggest loser, dropping -3.52%, followed by Sobha Ltd, which fell -3.07%, and Phoenix Mills Ltd, down -2.71%. The Nifty Consumer Durables index decreased by -733.10 points, or -1.91%, closing at 37,549.60. PG Electroplast shares, the major loser, tanked -22% after cutting FY26 growth guidance. Kalyan Jewellers India Ltd was another major loser, falling -10.64%, while Amber Enterprises India Ltd declined by -4.85%. Nifty Metal also declined, closing at 9,147.1, down -163.55 points, or -1.76%.
Asian markets were broadly on a mixed note, with Hong Kong’s Hang Seng Index losing 297.63 points, or 1.20%, to close at 24,784. The Shanghai Composite Index closed at 3,635.13, losing 4.54 points, or 0.12%. South Korea’s KOSPI Index closed in red at 3,210.01, down 17.67 points, or 0.55%. However, Japan’s Nikkei 225 Index closed in the green at 41,780, gaining 720.85 points, or 1.73%. The US Dow Jones Futures were trading at 44,125.44, up 156.8 points, or 0.36%, as of 5:13 p.m. IST.
The Nifty 50 index declined by 0.82% this week, primarily due to U.S. President Trump’s imposition of a 25% tariff on Indian exports, along with an additional 25% tariff announced on August 7, set to take effect in 21 days. The drop was further exacerbated by increased selling pressure from foreign investors.
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