Diwali Stock Picks 2023; Here’s Religare Broking 05 Stock Picks

As the Indian domestic equity market concluded Samvat 2079 on a robust note, breaching all-time highs in 2023, leading brokerage firm Religare Broking has identified its top five stock picks for Diwali 2023 in the context of Samvat 2080. Despite global geopolitical challenges arising from the Israel-Palestine and Russia-Ukraine conflicts, analysts anticipate that India’s market will maintain its bullish momentum into Vikram Samvat 2080, backed by mounting fundamental tailwinds.

Here’s a glimpse of Religare Broking’s top five Diwali 2023 stock picks, considering both technical and fundamental parameters:

1. Tata Consultancy Services (TCS):

• Target Price: ₹4,089; Upside: 20.9%
• TCS has shown steady topline growth at a 12.9% CAGR over the last five years, driven by strong demand for digital and cloud technology transformation.
• The recent correction in stock price post-Q2FY24 results has rendered it attractively valued for investment.
• Religare Broking maintains a Buy rating with a target price of ₹4,089.

2. ITC:

• Target Price: ₹535; Upside: 22.4%
• ITC focuses on the ITC Next strategy to build a future-ready portfolio, especially in FMCG, through innovation, renovation, and premiumization.
• The demerging hotel business aligns with the company’s positive plans.
• Religare Broking estimates Revenue/PAT to grow at a CAGR of 15%/19.2% over FY23-25E, assigning a Buy rating with a target price of ₹535.

3. Axis Bank:

• Target Price: ₹1,167; Upside: 14.2%
• Retail assets are the main growth driver, growing at a CAGR of 17% over FY20-23.
• Positive outlook on the bank’s growing assets book, premiumization of deposits, wealth management, and market position in the credit card segment.
• Expected NII/PPOP/PAT growth of 11%/15%/9% over FY23-25E, with a Buy rating and a target price of ₹1,167.

4. Maruti Suzuki India:

• Target Price: ₹12,714; Upside: 23.2%
• Anticipated market share growth in key areas with a superior product mix and favorable commodity prices.
• Estimated Revenue/EBITDA/PAT to grow at a CAGR of 18.2%/34.9%/33.5% over FY23-25E.
• Recommended Buy with a target price of ₹12,714, applying a PE of 27x on its FY25E EPS.

5. SBI Life Insurance:

• Target Price: ₹1,644; Upside: 22.2%
• Strong growth in SBI Life Insurance’s core operations, with APE growing at a CAGR of 16% from FY20-23.
• Positioned well in the resurgence of ULIP products, contributing to higher market share.
• Expected APE/NBP/VNB to grow at a CAGR of 19%/21%/23% over FY23-25E, with a Buy rating and a target price of ₹1,644.

Religare Broking emphasizes the selection of these stocks based on both technical and fundamental analyses, aligning with the optimistic outlook for the Indian market in Samvat 2080.