Best Undervalued Stocks in August 2026: Sona BLW, HAL, JSW Infra, and Others - Based on 1-Year Returns!

Undervalued stocks can appeal to investors seeking businesses trading below their perceived intrinsic value, backed by fundamentals, earnings potential or temporary market mispricing. This August 2026 list highlights companies across auto components, chemicals, infrastructure, defence, finance, pharma and mobility, using recent returns and key performance indicators to help readers identify names worth tracking more closely before making investment decisions.

Best Undervalued Stocks in August 2026

Note: These stocks have been selected and sorted based on their one-month returns. 

Overview of Best Undervalued Stocks for August 2026

1. Sona BLW Precision Forgings Ltd.

Sona BLW Precision Forgings is an auto-component manufacturer with a growing focus on electric vehicle (EV) components. The company reported strong Q1 FY27 performance, with revenue from operations rising 52.38% year-on-year to ₹1,301.20 crore and net profit increasing 45% to around ₹180 crore. The company has also entered the robotics and physical AI segment, with a ₹62.6 crore capital expenditure approved for advanced robotics manufacturing. Its sizeable order book provides visibility for future growth, while rising EV adoption remains a key long-term opportunity.

2. Navin Fluorine International Ltd.

Navin Fluorine operates in the specialty chemicals and fluorochemicals space, with businesses spanning high-performance products, specialty chemicals and contract development and manufacturing services (CDMO). The company entered FY27 with strong operating momentum after FY26 revenue grew 41% and EBITDA more than doubled. Management has indicated that the company is moving from a capex-heavy phase towards revenue generation, with strong capacity utilisation visibility in its specialty business and continued demand across its portfolio.

3. JSW Infrastructure Ltd.

JSW Infrastructure is one of India’s major private port operators, with operations spanning ports, logistics and related infrastructure services. In Q1 FY27, the company handled around 31 million tonnes of cargo, up 6% year-on-year, while revenue increased 18% to ₹1,444.83 crore. However, consolidated net profit declined nearly 10% to ₹346.63 crore, partly due to lower other income and a higher tax rate. EBITDA still grew 16% to ₹674 crore, indicating continued strength at the operating level.

4. Hindustan Aeronautics Ltd.

Hindustan Aeronautics (HAL) is a major Indian aerospace and defence manufacturer, producing aircraft, helicopters, engines and related systems. The company has one of the strongest order backlogs among Indian defence companies, with an order book of roughly ₹2.54 lakh crore at the end of FY26, providing several years of revenue visibility. Investors are closely watching the execution of the Tejas Mk1A programme and the pace at which HAL converts its large order book into revenue.

5. Bajaj Finance Ltd.

Bajaj Finance is one of India's largest diversified non-banking financial companies (NBFCs), offering consumer, personal, SME and commercial loans. The company continued to report strong business growth in Q1 FY27. Its assets under management rose 24% year-on-year to approximately ₹5.47 lakh crore, while new loans booked increased 20% to 16.13 million. The company also reported a 27-28% rise in Q1 profit, reinforcing its strong earnings momentum.

6. Sun Pharmaceutical Industries Ltd.

Sun Pharma is India's largest pharmaceutical company and has a diversified presence across domestic formulations, speciality medicines and international markets. The company continues to strengthen its speciality and global portfolio, while recent developments include approval for its generic semaglutide in South Africa. Investors are also watching its quarterly margins and the performance of its speciality business as the company targets continued revenue growth.

7. Shriram Finance Ltd.

Shriram Finance is a diversified NBFC with a strong presence in vehicle finance, particularly commercial vehicles, along with other lending businesses. The company reported a strong Q1 FY27, with consolidated revenue from operations rising 16.16% year-on-year to ₹13,400.43 crore. Profit attributable to shareholders increased nearly 60% to ₹3,452.77 crore. The strong earnings performance has also supported positive investor sentiment, with the stock recently touching record levels.

8. CholamandalamInvestment and Finance Co. Ltd.

Cholamandalam Investment and Finance is a Murugappa Group NBFC with a strong presence in vehicle finance, loans against property, consumer and small enterprise lending. The company delivered a strong Q1 FY27, with profit after tax rising 46% year-on-year to ₹1,654 crore. Aggregate disbursements increased 22% to ₹29,612 crore, while total assets under management reached ₹2.54 lakh crore. Its gold-loan business also crossed ₹2,000 crore in AUM during the quarter.

9. Eicher Motors Ltd.

Eicher Motors is best known for Royal Enfield motorcycles and also has a presence in commercial vehicles through VE Commercial Vehicles. The company reported strong Q1 FY27 performance, supported by record Royal Enfield volumes. Consolidated revenue reportedly rose over 30% year-on-year, while profit increased by more than 20%. The company has also approved a ₹1,225 crore greenfield expansion in Andhra Pradesh, which is expected to add significant motorcycle manufacturing capacity over the coming years.

10. Tata Capital Ltd.

Tata Capital is the financial services arm of the Tata Group and operates across consumer, housing, commercial and SME finance. The company reported a strong Q1 FY27, with consolidated net profit rising 56.32% year-on-year to ₹1,547.38 crore, while revenue from operations increased 15.10% to ₹8,821.93 crore. Net interest income also grew strongly. The company has expanded into gold loans through the acquisition of an 88.6% stake in Yogakshemam Loans, further diversifying its retail lending portfolio.

Best Undervalued Stocks for August 2026 Based on RoE and ROCE

Conclusion

The stocks listed above show how valuation opportunities can emerge across sectors when fundamentals, growth visibility and market sentiment align. However, undervaluation alone should not drive decisions. Investors should assess risks, financial strength and suitability before acting. Tracking these companies through a demat account can support informed monitoring, while independent research remains essential before investing in equities.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.