Kotak Securities Reveals Top 8 Stock Picks for Diwali 2024, Including Axis Bank, Zomato, and More

Indian markets hit record highs during Samvat 2080, with Nifty reaching 26,250 and the Sensex crossing 85,900 in September 2024. However, Kotak Securities pointed out that many stocks seem overvalued across various sectors, from large-cap consumer goods to smaller, lower-quality companies.

Despite the high valuations, Kotak Securities recommends viewing any future market correction as a chance to buy quality stocks for long-term gains. They have identified eight stocks that they believe are solid picks for Samvat 2081:

1. Aadhar Housing | Target Price: ₹550 | Potential Gain: 27%

Aadhar Housing, a leader in affordable housing finance, is expected to grow its assets under management (AUM) by 21% annually until 2027. The company has strong asset quality and a diverse geographic presence, making it a top pick in this sector.

2. Axis Bank | Target Price: ₹1,500 | Potential Gain: 26%

Axis Bank’s strong business strategy and focus on growing faster than the industry average make it a promising choice. Kotak Securities believes its current valuation offers a good buying opportunity among large private banks.

3. Fiem Industries | Target Price: ₹2,140 | Potential Gain: 34%

Fiem is a leading manufacturer of automotive lighting and rearview mirrors, especially for two-wheeler manufacturers. The company is expected to benefit from increased LED lighting use in vehicles, as well as its move into the four-wheeler segment.

4. Gravita India | Target Price: ₹2,800 | Potential Gain: 17%

Gravita India, a major player in the recycling industry, is poised for growth due to favorable regulations and penalties on battery makers. The company is expanding into new recycling areas like rubber, paper, and steel.

5. Godrej Agrovet | Target Price: ₹850 | Potential Gain: 11%

Despite near-term challenges in animal feed prices, Kotak sees long-term growth potential in Godrej Agrovet’s crop protection business and its involvement in the palm oil sector.

6. JB Chemicals | Target Price: ₹2,255 | Potential Gain: 18%

JB Chemicals focuses on domestic formulations and has a growing CMO business. With a strong portfolio of products and global leadership in lozenge manufacturing, it is expected to see solid growth in revenue and earnings.

7. S H Kelkar | Target Price: ₹400 | Potential Gain: 30%

S H Kelkar, a supplier of flavors and fragrances, is making strides in the global market. With new orders from major clients like Unilever, the company is well-positioned for long-term growth.

8. Zomato | Target Price: ₹315 | Potential Gain: 18.5%

Zomato holds a significant market share in online food delivery and is rapidly expanding its quick-commerce business, Blinkit. Kotak expects strong revenue growth and improved profitability for Zomato in the coming years.

These eight stocks were selected for their strong growth potential, solid financials, and promising future outlook according to Kotak Securities’ market analysis for Diwali 2024.