As the Indian equity market reached new heights in Samvat 2079, Asset Management Company Anand Rathi Investment Services gave a list of six stocks as Diwali picks for the upcoming Samvat 2080. On November 10, 2023, BSE Sensex closed at 64,904 with year-to-date gains of 6.11 per cent and one-year returns of 5 per cent.
The S&P BSE Midcap soared 27.92 per cent year-to-date, the S&P BSE Large-Cap saw a 5.15 per cent growth, and the small-cap index surged 31.57 per cent year-to-date.
Ananth Rathi Stock Picks
Of the six stocks, four belong to the large-cap category. DLF Ltd. takes the lead in the PE/PB ratio (40), indicating that the market values the company at a relatively higher multiple of its earnings and book value. IDFC First Bank Ltd. and Mahindra & Mahindra Ltd. recorded the least PE of 12, underlining their strong fundamentals.
All stocks on the list are expected to have an upside potential of 15-20 per cent, according to a press release by Ananth Rathi.
1. Syrma SGS Technology Ltd
(Current Market Price: Rs 612, Target Price: Rs 735, Market Cap: Rs 108 billion - mid-cap)
Syrma SGS Technology boasts a robust order book of about Rs 35,000 million, with Rs 22,000 to Rs 23,000 expected to be delivered next year. The company plans to spend Rs 2,000 to Rs 2,500 million annually. The AMC says the company can be a crucial player in the growing Electronics System Design & Manufacturing (ESDM) industry, especially in the Original Design Manufacturer (ODM) segment, if it seizes the opportunities available across end-user industries.
2. IDFC First Bank Ltd
(Current Market Price: Rs 83, Target Price: Rs 114, Market Cap: Rs 587 billion - Large cap)
Having successfully transformed from an infra financier to a granular retail lending bank, IDFC First Bank is focusing on building a scalable liability franchise. Despite strong granular loan growth, this would keep costs high in the near term. The bank expects the credit card business to break even by FY25.
3. DLF Ltd.
(Current Market Price: Rs 554, Target Price: Rs 640, Market Cap: Rs 1,370 billion - Large cap)
DLF's entry into Mumbai through a slum redevelopment project in Andheri West is noteworthy. For FY24, management expects pre-sales to surpass Rs 1,20,000 million, driven by significant inventory, upcoming launches, and strong demand.
4. MTAR Technologies Ltd.
(Current Market Price: Rs 2,471, Target Price: Rs 2,970, Market Cap: Rs 76 billion)
MTAR Technologies is expanding its product range, including valves and semi-cryogenic engines in the defence and space sectors. MTAR expects to secure defence contracts shortly, enabling direct supply to major OEMs and the Ministry of Defense.
5. TVS Motor Company Ltd.
(Current Market Price: Rs 1,609, Target Price: Rs 1,850, Market Cap: Rs 764 billion)
TVS expanded its presence beyond the South in terms of sales due to the efforts taken over the years to improve its Pan-India dealer network. The company is poised to outperform the industry due to new product launches in ICE & EV segments, higher focus on exports and premiumisation, etc
6. Mahindra & Mahindra Ltd.
(Current Market Price: Rs 1,497, Target Price: Rs 1,770, Market Cap: Rs 1,862 billion)
Mahindra & Mahindra commands a market share of 42.9 per cent in Q1FY24 domestic tractor market. With the introduction of the Oja range and a well-established sales and service network, it is expected to maintain its leadership position going forward as well.
Investors are advised to conduct their research and consider their risk tolerance before making investment decisions based on these recommendations.
Disclaimer: All stock recommendations in the article are from Anand Rathi. Outlook Money’s editorial team is not responsible for any inaccuracies in the content. Readers should exercise caution when looking at the data, and they should do their own research before investing and not blindly pick up the recommendations.
