RBL Bank & UPL: Bajaj Broking’s Top Stock Picks for January 16, 2026 – Buy or Avoid?

Top stocks to buy today: Stock recommendations for January 16 - check list

January 16, 2026, brings fresh opportunities—and risks—for Indian equity investors. As the Nifty flirts with all-time highs and global cues remain mixed, brokerage house Bajaj Broking has cut through the noise with two clear stocks to buy today: RBL Bank and UPL.

But are these picks grounded in solid fundamentals or short-term momentum plays? And how should retail investors interpret the broader market signals from Nifty and Bank Nifty? In this deep-dive analysis, we unpack the rationale behind these recommendations, assess potential upside and downside, and offer actionable insights—because in today’s volatile market, blind buying is a recipe for regret.

Table of Contents

Market Snapshot: Nifty and Bank Nifty Outlook

As of January 16, 2026, the Nifty 50 is trading near 24,850—just shy of its lifetime high—supported by strong FII inflows and resilient domestic consumption data. However, analysts warn of overbought conditions, with the 14-day RSI hovering above 65 .

Meanwhile, Bank Nifty shows signs of consolidation after a sharp rally in Q4 2025. Bajaj Broking notes that private sector banks like RBL could outperform if asset quality continues to improve and credit growth remains robust—a key theme for 2026.

RBL Bank: Turnaround Story or Value Trap?

Bajaj Broking has reiterated its “Buy” rating on RBL Bank with a target price of ₹320—a potential upside of ~18% from current levels (~₹271). Their bullish stance rests on three pillars:

  • Improving Asset Quality: Gross NPA ratio declined to 2.8% in Q3 FY26 from 4.1% YoY, signaling effective credit risk management.
  • Strong CASA Growth: Current Account Savings Account (CASA) ratio rose to 42%, reducing cost of funds and boosting net interest margins.
  • Digital Lending Momentum: The bank’s co-lending partnerships with fintechs drove 35% YoY growth in retail advances .

However, skeptics point to RBL’s relatively small balance sheet and exposure to mid-ticket MSME loans—a segment vulnerable to economic slowdowns. Still, for investors seeking high-beta private bank exposure, RBL offers compelling risk-reward.

UPL Stock Analysis: Agrochemical Giant Poised for Rebound?

Once a darling of the agrochemical space, UPL has struggled since its debt-laden acquisition of Arysta LifeScience. But Bajaj Broking sees green shoots:

  • Debt Reduction Progress: Net debt/EBITDA improved to 4.2x from 6.8x in 2024, with a clear path to sub-3x by FY27.
  • Global Pricing Power: Strong demand in Latin America and Africa has allowed UPL to pass on input cost inflation.
  • Monsoon & Sowing Season Tailwinds: Early forecasts predict a normal 2026 monsoon—critical for Indian agrochemical consumption .

The brokerage maintains a “Buy” call with a target of ₹950 (current price: ~₹780), citing valuation comfort at 12x FY27E P/E versus historical average of 15x.

Bajaj Broking’s Strategy Behind the Picks

These selections reflect a tactical shift toward “quality turnaround” stories—companies with visible operational improvements but still trading at discounts to peers. As noted in their morning note, “We favor businesses where execution risk is declining faster than the market anticipates” .

Both RBL Bank and UPL fit this mold: they’ve faced significant headwinds but are now showing concrete evidence of stabilization—making them ideal candidates for contrarian accumulation.

Key Risks to Watch Before Investing

Before jumping in, consider these red flags:

  • RBL Bank: Regulatory scrutiny on co-lending models could slow loan growth.
  • UPL: Currency volatility (60% revenue is overseas) and geopolitical tensions in key markets like Brazil.
  • Macro Risk: Any spike in crude oil prices or US bond yields could trigger broad market correction.

Investors should also avoid overconcentration—limit exposure to any single small/mid-cap pick to 3–5% of portfolio.

How Retail Investors Should Approach These Picks

For the average investor, here’s a prudent strategy:

  1. Stagger Entry: Buy 50% now, rest on dips (e.g., if Nifty corrects to 24,200).
  2. Set Stop-Losses: 8–10% below entry to manage downside.
  3. Monitor Catalysts: RBL’s Q4 results (Feb 2026); UPL’s debt reduction update (March 2026).

And remember: these are trading-to-medium-term calls, not forever stocks. Always align with your risk profile.

Conclusion: Balancing Opportunity and Caution

Bajaj Broking’s stocks to buy today—RBL Bank and UPL—offer exciting potential, but they’re not without risk. In a market that’s already priced in much good news, selectivity is key. These picks reward those who understand the nuances of turnaround investing and have the discipline to exit when the story fades.

As always, never invest based on a single recommendation. Do your own research or consult a SEBI-registered advisor. For more daily insights, explore our [INTERNAL_LINK:daily-stock-recommendations] hub.

Sources

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