Midcap Stocks Shine Amid Mixed Q2 FY26 Earnings
Midcap companies have demonstrated varied earnings performance during the second quarter of fiscal year 2026, with differences primarily driven by sector-specific dynamics and individual company execution cycles. Despite this mixed picture, the broader midcap landscape continues to benefit from structural demand resiliency across multiple sectors including industrial, engineering, packaging, utilities, and export-focused themes.
Companies across this segment are actively investing in capacity expansion, margin optimization, and product diversification to establish sustainable growth pathways. According to Axis Securities, management commentaries universally express positivity about H2FY26 execution, supported by stronger order inflows, improving domestic liquidity conditions, and a gradually recovering global demand environment in select markets.
Axis Securities' Investment Rationale
The brokerage firm emphasizes that with stabilizing sector indicators, improving capacity utilization trends, and long-term structural enablers, midcap stocks present compelling risk-reward opportunities. "To ensure your portfolio remains well-positioned for both near-term cyclical recovery and medium-term compounding, we strongly recommend taking timely action on the ideas outlined below," stated the brokerage in its latest analysis.
Axis Securities has identified six midcap stocks with strong conviction in the chemicals and midcap space that investors should consider adding to their portfolios.
Top Midcap Stock Recommendations
Aarti Industries - The brokerage maintains a 'Buy' rating with a target price of ₹530 per share, valuing the stock at 23 times September 2027 estimated EPS.
Pitti Engineering - Rated 'Buy' with a target price of ₹1,335, representing 22 times September 2027 estimated EPS. The firm believes current valuations appear attractive.
VA Tech Wabag - Maintaining a 'Buy' recommendation with a target price of ₹1,930 per share, valued at 21 times September 2027 estimated EPS. The company's order book remains healthy, supporting a positive long-term outlook.
Kirloskar Brothers - With sustained demand from key end markets and a robust order book, the company is positioned to achieve double-digit revenue growth in the medium term. Axis Securities recommends 'Buy' with a target price of ₹2,330 per share.
Gravita India - The brokerage values the stock at 32 times FY27 estimated EPS with a target price of ₹2,600 per share and recommends a 'Buy' rating.
Mold-Tek Packaging - Rated 'Buy' with a target price of ₹850 per share, representing 20 times September 2027 estimated EPS.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
