Diwali Stocks to Buy: Nifty has witnessed a sharp 28 percent rise since Diwali last year. India’s weight in global indices has been rising sharply over the past few years and continued performance will attract higher attention and allocation from large global funds.
The weakening of US dollar and rate cuts by US Fed are likely to improve FPI sentiments towards our markets.
The analysts at HDFC Securities compiled a list of 10 stocks - two mega caps, and 4 each in mid cap and small cap category that are likely to offer relatively limited downside and superior upside potential.
Diwali Stock Picks
1) Bank of India: BoI boasts a strong capital adequacy ratio, improved NIMs, and enhanced asset quality, evidenced by lower gross and net non-performing assets (GNPA & NNPA), it said in its report adding, "We recommend investors to buy the stock in the Rs 96-106 band for a target price of Rs 132 till next Diwali," it said.
2) JK Lakshmi Cement Ltd: The brokerage expect the cement demand to pick up pace by H2FY25. "Taking into consideration the capacity expansion and strengthening operational performance, we expect the company to report a healthy performance in the coming years. We believe investors can buy the stock in Rs. 738-819 band (15x FY26E EPS) for a target of Rs
936 (18x FY26E EPS) till next Diwali," it said.
3) Jyothy Labs: JLL has successfully undergone a substantial transformation from a promoter-driven, south-centric, single product entity to a professionally managed, and multi-product company operating nationwide. "We recommend a buy on Jyothy Labs in the band of Rs 480-533 for target price of Rs 600 (43.75x FY26E EPS) till next Diwali," the analysts said.
4) L&T Finance: LTF, over the years has been constantly reducing its dependence on the wholesale lending business by aggressively expanding its well diversified retail financing business. "We envisage a 18% growth in advances over FY24-FY26. and recommend investors to buy the stock in the Rs. 153-170 band for a target price of Rs. 219 (2.0x FY26 ABV) till next Diwali," it said.
5) National Aluminium Company: NALCO is one of the lowest cost producers of alumina globally and has integrated operations with an increase in alumina refinery capacity. We believe investors can buy the stock in Rs. 198-220 band for a target of Rs. 270 (15x FY26E EPS) till next Diwali, it said.
6) Navin Fluorine International: We recommend buy on Navin Fluorine in the band of Rs. 3059-3396 for a target price of Rs. 3948 (40.5x FY26E EPS) till next Diwali, the analysts at HDFC Securities said.
7) NCC Ltd: The brokerage recommended a price target of Rs 363 till next Diwali.
8) PNB Housing Finance: "We recommend investors to buy the stock in the Rs. 893-991 band for a target price of Rs. 1160 (1.7x FY26E ABV) till next Diwali," it said.
9) Reliance Industries: The domestic brokerage recommended a price target of Rs 3243 till next Diwali.
10) State Bank of India: We believe SBIN is equipped to sustain growth, given its surplus liquidity (Rs. 3.7trn) and a comfortable LDR (76.5%) and recommend investors to buy in the Rs. 733-813 band with a target price of Rs 960 (1.8x Mar-26 ABVPS)," it said.
Despite short term headwinds, the analysts believe superior growth prospects of India are likely to continue attracting foreign flows in the long run.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
