Top Diwali stock picks for 2024: Motilal Oswal recommends ICICI Bank, HCL Tech, Titan, Zomato, L&T, and more for Muhurat trading

As the Diwali season approaches, Motilal Oswal Wealth Management has released its top stock picks across various sectors, each showing potential for robust growth and profitability. These selections, targeting multiple industries, reflect the company’s insights into financial, digital, defensive, and industrial sectors, considering projected returns, competitive positioning, and market dynamics.

Financials stocks to buy this Diwali

1. ICICI Bank: ICICI Bank’s steady quarter stands out in a challenging environment, showing a 15% YoY growth in net earnings. The bank’s focus on a high-yielding portfolio across business banking, SME, and secured retail segments is expected to maintain its growth trajectory. Target Price: ₹1,400; Upside: 12%.
2. Five Star Business Finance: With a projected 35% AUM growth for FY25 and a competitive lending rate, Five Star is well-positioned to capture market share. Its focus on operational efficiency and digital collection is expected to ensure sustained profitability. Target Price: ₹1,200; Upside: 13%.
3. Angel One: Diversifying into credit products and wealth management, Angel One has leveraged strong cost control to deliver a 39% YoY PAT increase, maintaining a CI ratio of 50.1%. Target Price: ₹4,100; Upside: 43%.

Digital stocks to buy this Diwali

1. HCL Tech: HCL Tech revised its FY25 growth guidance to 3.5%-5%, driven by deal wins and its focus on data/SAP modernization. Positioned for growth in GenAI and digital platforms, HCL is expected to benefit from recovery in client spending. Target Price: ₹2,300; Upside: 25%.
2. Zomato: Zomato aims to strengthen its brand across food delivery, groceries, and dine-out services. With Blinkit’s growth, Zomato is projected to achieve a revenue CAGR of 55% through FY24-27. Target Price: ₹330; Upside: 30%.

Defensives stocks to buy this Diwali

1. Titan: Titan continues to outperform due to its strong brand recall and business moat. Plans to open new Tanishq and CaratLane stores add to its growth outlook. Target Price: ₹4,300; Upside: 29%.
2. IPCA Laboratories: IPCA, focusing on APIs and formulations, expects earnings growth with a 14% CAGR in the domestic market. Key drivers include improved operational efficiency and synergies from recent acquisitions. Target Price: ₹1,950; Upside: 23%.

Industrials stocks to buy this Diwali

1. L&T: Larsen & Toubro is expanding into offshore wind, green hydrogen, and nuclear projects, with a significant order backlog of USD100m. This, coupled with an RoE target of 18%, makes L&T a top pick in the industrial space. Target Price: ₹4,250; Upside: 23%.
2. Amber Enterprises: With a stronghold in the RAC market, Amber’s focus on consumer durables and electronics projects a 21% revenue CAGR over FY24-27. Target Price: ₹7,350; Upside: 18%.
3. Zen Technologies: As a leader in anti-drone technology, Zen Technologies holds 150+ patents and is poised for market expansion, particularly in defense and surveillance sectors. Target Price: ₹1,900; Upside: 8%.

Motilal Oswal’s Diwali picks reflect a comprehensive approach to high-potential stocks across diverse sectors. From ICICI Bank’s stable growth to Zen Technologies’ innovative defense solutions, these recommendations aim to capture market opportunities across the board. Investors may find these picks beneficial as they align with growth trajectories, competitive advantages, and sectoral tailwinds for the coming financial years.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should consult their financial advisors before making any investment decisions.