Diwali 2024
Since last Diwali, the Nifty index has risen by about 25%. However, JM Financial has noted some short-term risks that could impact this growth, including the recent rise in crude oil prices, concerns about a global economic slowdown, and ongoing geopolitical tensions.
JM Financial, a domestic brokerage firm, has recommended a list of 10 stocks to consider buying this Diwali for potential returns of 15-28% in Samvat 2081. The list includes companies like Reliance Industries, Bajaj Finance, Power Grid Corporation of India, Jindal Steel & Power (JSPL), and Ashoka Buildcon.
Since last Diwali, Nifty has risen by around 25%. However, JM Financial warns that recent increases in crude oil prices, concerns about a global economic slowdown, and geopolitical tensions pose potential short-term risks to the country’s overall GDP growth.
Here’s what JM Financial shared about its stock picks for Diwali 2024:
1. Reliance Industries Ltd

Reliance Industries Ltd. (RIL) is a large, diversified company with operations across various sectors, including oil-to-chemicals (refining and petrochemicals), exploration and production (E&P), digital services, retail, media, and new energy. The company aims to boost revenue in its Jio and retail segments over the next 3-4 years. Additionally, its focus on green energy places it in a strong position for the future.
Earnings are expected to grow steadily across all segments. JM Financial projects that RIL could achieve an annual profit growth (PAT) of 15% from FY24 to FY27. The brokerage has set a target price of Rs 3,500, suggesting a potential upside of about 28% within the next 6-12 months.
2. Power Grid Corporation of India Ltd

Power Grid Corporation of India Ltd. (PGCIL) is India’s largest power transmission company, responsible for managing about 45% of the nation’s electricity. It owns and operates most of India’s inter-regional and interstate transmission networks.
With significant growth potential in the transmission sector expected through 2032, PGCIL’s planned capital expenditure and regulated business model offer strong earnings stability. JM Financial has set a target price of Rs 383 for the stock, indicating a potential upside of 17% over the next 6-12 months.
3. Bajaj Finance Ltd

Bajaj Finance is a top player in retail lending, providing various consumer loans, including for two- and three-wheelers, housing, gold, and MSME financing. The company has steadily grown its assets under management and focuses more on secured loans in line with RBI guidelines. With one of the largest deposit bases among NBFCs at Rs. 63,000 crore, Bajaj Finance is well-positioned for growth, especially with the festive season expected to drive up demand. JM Financial has set a target price of Rs 8,552 for Bajaj Finance, indicating a potential 18.6% upside.
4. ICICI Lombard General Insurance Ltd

ICICI Lombard is the second-largest general insurer in India, following New India Assurance Co., with an 8.6% market share of FY24 premiums. It leads in motor insurance and is the top private insurer in important commercial areas like fire, engineering, marine, and liability. Additionally, ICICI Lombard is growing quickly in the health insurance sector. JM Financial has set a target price of Rs 2,450 for the company, suggesting a potential upside of 17% over the next 6-12 months.
5. Jindal Steel & Power Ltd

Jindal Steel and Power (JSPL) is a top steel manufacturer in India, currently producing 9.6 million tons per year (mtpa). The company is investing in expanding its crude steel production capacity by 65%, increasing it to 15.9 mtpa. This expansion will greatly boost its production and position JSPL as the fourth-largest steel manufacturer in India by FY26.
JM Financial has set a target price of ₹1,150 for Jindal Steel and Power (JSPL), indicating a potential 19% increase.
6. Nalco Ltd

Nalco is a public sector company, and the Indian government holds a 51.3% stake as of June 30. It is one of India’s largest bauxite, alumina, and aluminum producers, with production figures of 0.46 million tons for aluminum and 2.12 million tons for alumina in FY24. The company’s alumina export sales reached 1.17 million tons in FY24. Nalco’s plans to expand its alumina refinery, increase alumina prices, and cost savings from captive coal mining are expected to boost its earnings. JM Financial values this stock at ₹264, suggesting a potential increase of 17% in the next 6-12 months.
7. Gravita India Ltd

Gravita India is a key player in the recycling industry, focusing on three main areas: lead, aluminum, and plastics. The company plans to expand into other sectors like steel, paper, and lithium-ion batteries. As one of the largest lead recyclers in India, Gravita gets 82% of its earnings before interest, taxes, depreciation, and amortization (EBITDA) from lead recycling. According to JM Financial, the company’s capital expenditure plans and supportive regulatory changes create strong growth opportunities for its recycling business. They have set a target price of ₹3,068 for the stock, indicating a potential increase of 21%.
8. Macrotech Developers Ltd

According to JM Financial, Macrotech Developers, commonly known as Lodha, is expected to strengthen its leadership in the real estate market. This growth is supported by its effective sales strategy and a balanced range of projects, including premium, mid-income, and affordable housing, along with favorable conditions in the residential market. Lodha is also expanding into logistics parks, commercial spaces, and retail as part of its mixed-use developments, enhancing its position as a leading developer across various categories and customer segments.
JM Financial highlighted that Macrotech has a strong history of creating residential townships that generate consistent cash flow and is focused on adding more asset-light projects. They have set a target price of ₹1,480 for the stock, indicating a potential increase of 23%.
9. Olectra Greentech Ltd

Olectra is one of India’s largest manufacturers of electric buses and plays a significant role in the electric vehicle (EV) market. The company has set up a modern plant in Hyderabad that can produce 5,000 electric buses per year, potentially expanding to 10,000 units annually. They have already started some operations at this new facility.
Olectra’s partnership with BYD, with a growing demand for electric buses and a solid order book, presents strong growth opportunities. JM Financial has suggested a target price of ₹2,200 for the stock.
10. Ashoka Buildcon Ltd

Ashoka Buildcon Ltd offers various construction services, including building roads, bridges, and power transmission and distribution projects. It is a major player in the BOT (Build Own, Transfer) segment and has recently entered the CGD (City Gas Distribution) market. The company’s performance is expected to improve due to its diverse order book, strong execution skills, expected acceleration in project execution, and decreasing debt. JM Financial has set a target price of Rs 290 for the stock.
Conclusion
As Diwali 2024 approaches, investors seek opportunities to enhance their portfolios. The 10 stocks highlighted here, including industry leaders like Reliance Industries, Bajaj Finance, and Jindal Steel & Power, are expected to offer promising returns of 15-28% within 6-12 months. These companies are well-positioned for growth with strong fundamentals, diversified operations, and favorable market conditions. Watch these stocks as you consider your investment strategy this festive season.
FAQs
Q1: What are the top stocks to consider for Diwali 2024?
Ans: The top stocks recommended for Diwali 2024 include Reliance Industries, Bajaj Finance, Power Grid Corporation, Jindal Steel & Power, and Ashoka Buildcon. These companies are expected to deliver returns ranging from 15% to 28% in the next 6-12 months.
Q2: Why are these stocks expected to perform well?
Ans: These stocks are backed by strong fundamentals, diversified operations, and robust growth strategies. Factors like market demand, earnings visibility, and expansion plans contribute to their potential for significant returns.
Q3: How long should I hold these stocks?
Ans: Investors should consider holding these stocks for at least 6-12 months to realize the anticipated returns, as market conditions and company performance can evolve.
Q4: What risks should I be aware of?
Ans: Potential risks include fluctuations in crude oil prices, global economic slowdowns, and geopolitical concerns, which can affect overall market performance and specific industries.
Q5: Should I invest in all 10 stocks?
Ans: While diversification can reduce risk, it’s essential to assess your investment goals, risk tolerance, and the performance of each stock before making investment decisions. Consulting with a financial advisor can also help tailor your approach.
Q6: Are these stocks suitable for all types of investors?
Ans: These stocks may appeal to growth-oriented investors looking for long-term capital appreciation. However, individual investment strategies should be considered, and investors should perform their due diligence before investing.
Q7: How can I purchase these stocks?
Ans: You can purchase these stocks through a brokerage account. If you don’t have one, you can open an account with a brokerage firm or use an online trading platform to buy and sell shares.
Q8: What factors should I consider before investing?
Ans: Consider factors such as the company’s financial health, industry trends, market conditions, and your investment horizon. Researching the companies’ past performance and future growth potential is also crucial.
Q9: How often should I review my investment?
Ans: It’s advisable to review your investments regularly, at least quarterly or semi-annually, to assess performance and make any necessary adjustments based on market changes or shifts in your investment strategy.
Q10: What should I do if the stock prices fall?
Ans: If stock prices fall, evaluate the reasons behind the decline. If the fundamentals of the company remain strong, it may be wise to hold your investment. However, if you believe the company’s prospects have changed negatively, consider consulting with a financial advisor for guidance.