As the festive season approaches, Kotak Securities has identified its eight stock picks for Diwali 2024, emphasizing opportunities for long-term investors. With the markets showing signs of overvaluation, this timely recommendation offers a strategic perspective for investors looking to bolster their portfolios as we head into Samvat 2081. Here’s a detailed look at Kotal Securities’ stock recommendations for the upcoming year.
| Table of Contents |
|---|
| Aadhar Housing Finance |
| Axis Bank |
| Fiem Industries |
| Gravita India |
| Godrej Agrovet |
| JB Chemicals |
| S H Kelkar |
| Zomato |
Aadhar Housing Finance
Recommendation: Buy
Target Price: ₹550
Upside: 27%
Aadhar Housing Finance is a leader in the affordable housing finance sector, boasting a significant market share. The company has ambitious plans to achieve a 21% AUM CAGR from FY24 to FY27, coupled with expected improvements in ROEs to the high teens.
Axis Bank
Recommendation: Buy
Target Price: ₹1,500
Upside: 26%
With a strong focus on business execution and an effective GPS strategy, Axis Bank positions itself favorably for growth. The bank aims to outpace the industry in deposit growth while enhancing its loan portfolio profitability, targeting RoEs around 15%.
Fiem Industries
Recommendation: Buy
Target Price: ₹2,140
Upside: 34%
Fiem Industries has established itself as a significant player in the automotive lighting sector. The growing adoption of LEDs places Fiem in a position of strength, with plans to leverage its expertise in LED technology to penetrate the four-wheeler segment.
Gravita India
Recommendation: Add
Target Price: ₹2,800
Upside: 17%
Gravita India holds a strong position in the lead recycling market, with an aim to expand its capacity and diversify into other recycling segments. Support from stringent regulatory frameworks and penalties on OEMs for recycling non-compliance further underpin the company’s growth potential.
Godrej Agrovet
Recommendation: Add
Target Price: ₹850
Upside: 11%
Despite experiencing mixed trends, Godrej Agrovet is bolstered by robust growth prospects in the CDMO segment and favorable conditions resulting from palm oil duties. The company showcases resilience and healthy anticipated earnings growth.
JB Chemicals
Recommendation: Buy
Target Price: ₹2,255
Upside: 18%
Focused on domestic formulations, JB Chemicals has seen a notable increase in sales contributions from domestic and CMO segments. With continued expectations of robust growth in revenue, EBITDA, and PAT, the company is well-positioned for future success.
S H Kelkar
Recommendation: Buy
Target Price: ₹400
Upside: 30%
S H Kelkar stands out as a prominent fragrance and flavor supplier with increasing global reach. The firm is set to achieve double-digit revenue growth, boosted by its strong technical capabilities and a significant recent contract win from Unilever.
Zomato
Recommendation: Buy
Target Price: ₹315
Upside: 18.5%
Zomato continues to dominate the market with a leading share over competitors like Swiggy. The company is planning to expand its Blinkit service into more cities, which is expected to significantly enhance revenue growth and improve EBITDA margins.
Conclusion
Kotak Securities has provided a comprehensive list of investment recommendations targeted at long-term growth despite prevailing market conditions. Each of these stock picks reflects unique strengths in their respective industries. As investors prepare for Diwali 2024, it’s crucial to approach these opportunities with a long-term strategy in mind. We advise investors to consult with financial advisors to align their investment decisions with personal risk profiles and market conditions.
FAQs
1. Why is Diwali considered an auspicious time for investments?
Diwali is traditionally viewed as a time of new beginnings and prosperity, making it a popular period for making fresh investments in India.
2. What factors contribute to Kotak Securities’ stock picks?
Kotak Securities bases its recommendations on current market assessments, company fundamentals, growth potential, and long-term financial planning.
3. Should investors diversify their portfolios with these recommendations?
Yes, diversification is a key strategy to minimize risks. Investors should consider their risk tolerance and investment goals when building their portfolios.
