After ‘difficult’ 2026, UBS sees better days for Internet Cos, highlights preferred picks

Brokerage firm UBS sees better days ahead for India’s internet companies, after a “tough” 2026 so far, which has resulted in some of these companies seeing losses from 10% to as much as 30%.UBS noted that this underperformance has been primarily driven by investor concerns regarding a weak macroeconomic environment, intensified market competition, and the potential for disruption from emerging AI technologies.

Signs Of Stability

Despite the recent volatility, recent checks carried out by the brokerage suggest that the broader market sentiment may be shifting.
Growth metrics, including Gross Merchandise Value (GMV), Number of Orders (NOV), and billings across key business segments, are showing signs of stabilization following the slowdown observed in the second half of financial year 2026, according to the UBS note.Additionally, competitive intensity in the Quick Commerce (QC) space is also beginning to show signs of moderation, offering a potential reprieve for incumbent players, UBS noted.

UBS Top Picks Among Internet Companies

UBS has adjusted its outlook on several key players in the sector, highlighting a preference for those demonstrating resilience in growth and clear value propositions. Here’s a look at its top picks:

Eternal: The stock is UBS’ top pick within the sector. It has a “buy” rating and a price target of ₹305, implying an upside potential of 20% from current levels.

Meesho: The brokerage has maintained its “buy” rating here with a price target of ₹210, indicating an upside potential of 27% from current levels.

Info Edge: UBS has upgraded the stock to “buy” from its earlier rating of “neutral” with a price target of ₹1,280, with the stock having corrected 25% so far this year.

Swiggy: The brokerage has a “buy” rating on the stock with a price target of ₹335, implying an upside potential of 26%.

Jerk: UBS said that the competitive moat is widening for the stock but valuations remain a key hurdle. Therefore, it remains “neutral” with a price target of ₹290.