Stocks to buy: Analyst at Kotak Sec bets on CarTrade Tech, Gravita India

Stocks to Buy Today: Recommendations by Shrikant Chouhan, Kotak Securities

CarTrade Tech – Buy

CMP – ₹2,070

Fair value – ₹2,300

Resistance – ₹2,120-₹2,220

Support – ₹2,010-₹1,880 

A key driver of our positive outlook is OLX India, which remains the only marketplace of scale in India’s second-hand goods buy-and-sell market. Since its acquisition by CarTrade in 2023, OLX has maintained a stable monthly active user (MAU) base of 30–32 million, supported entirely by organic traffic. The platform benefits from strong network effects and limited direct competition, making it a unique digital asset within CarTrade’s portfolio. While historical GMV data is unavailable, annualized GMV transacted on the OLX platform was estimated at approximately US$3 billion in FY2025, and we believe this figure increased further in FY2026. 

Despite facilitating a large volume of transactions, OLX generated revenue of only ₹2.2 billion in FY2026, implying a take rate of roughly 0.7 per cent. This low monetization level presents a significant opportunity for future growth. We expect monetization to improve through initiatives such as the Elite Buyer Program, user verification services, premium listings, and other value-added offerings for buyers and sellers. Importantly, OLX has remained profitable since acquisition, reporting Ebitda of ₹67.1 crore, and PAT of ₹82 crore in FY2026. Given its asset-light operating model and 100 per cent organic traffic, we see substantial scope for margin expansion, with Ebitda margins expected to improve from 31 per cent in FY2026 to 37 per cent in FY2027 and 39 per cent in FY2028. 

Gravita India – Add

CMP – ₹1,547

Fair value – ₹1,910

Resistance – ₹1,620-₹1650

Support – ₹1,510-₹1,460

GRAV’s Q4FY26 PAT (-3.4 per cent yoy) was higher than our estimates, with better volumes partially offset by lower margins. Margins were impacted by the conflict in the Middle East, which contributes 10-15 per cent of volumes. 

GRAV has acquired Rashtriya Metal Industries (RMIL) for ₹560 crore, marking its entry into the copper segment. RMIL has a 31.2 ktpa capacity plant in Sarigram, Gujarat with revenues/Ebitda of ₹1,040/80 crore in FY2026. GRAV also plans to establish a 29.4 ktpa copper recycling plant in Mandvi, Gujarat, at a capex of ₹160 crore over the next 12 months. This would process scrap and backward integrate downstream assets of RMIL. In the next phase, GRAV may add additional 30 ktpa capacity at each of its copper plants in Gujarat. Utilisation at RMIL is 50 per cent, and should improve to 60-65 per cent, along with improvement in margins from ₹45/kg to ₹70/kg after full integration over FY2027-29. Working capital days should remain at 90 days since copper scrap is sourced largely from the West. 

Lead capacity of 80 ktpa in Mundra was commissioned in Q4FY26, with another 45 ktpa in Phagi likely to be commissioned in H1FY27 after regulatory approvals (delay of 1-2 quarters). India rubber capacity should also commence within similar timelines, with improving copper utilisations at RMIL in the 60-65 per cent range. The company expects volumes from these divisions to propel volume growth to 20-25 per cent on a yoy basis over the next 2-3 years. The Li-ion battery (LIB) pilot plant in Mundra is also operational, but the company does not expect any revenues from the segment in the near term. 

We tweak EPS by 0-1 per cent for FY2027/28E, factoring in foray in the copper segment. We are positive stock with Add rating with ₹1,910.