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With the expectation of a strong recovery in corporate earnings, the Indian market is positioned to continue its bull run, said brokerage house SMC Global in a report. As part of its Diwali stock pick ideas for Samvat 2078, the brokerage has recommended nine stocks that include ICICI Bank, State Bank of India (SBI), Larsen & Toubro (L&T), and DLF.

Endurance Tech, Prestige Estates, Welspun India, KEC International, Phillips Carbon are also part of its top recommendations.

“A key rule of investing in a bull market is a gradual shift towards quality stock. It is an opportune time for the investors to tweak their portfolio by embracing buy on dips strategy selectively in quality stocks," SMC Global said in a note.

Top stock picks for Diwali -

SBI: State Bank of India appears well positioned to report strong uptick in earnings, led by moderation in credit cost from FY22. The brokerage has a Buy rating on the stock with a target price of 577 in 8 to 10 months time frame.

ICICI Bank: The bank is focusing on growing the core operating profit in a risk calibrated manner instead of loan growth. Thus, “it is expected that the stock will see a price target of Rs.874 in 8 to 10 months’ time frame."

L&T: The company will maintain leadership in the E&C segment in India, and is positioned to benefit from the large infrastructure spending in India, over the medium term. SMC has a target price of 2120.

DLF: The company has sustained business performance despite its operations being impacted by the second Covid-19 wave. The buy rating comes with a target price of 474.

Endurance Tech: “A strong balance sheet and liquidity position enable the company to move forward on its growth journey without any compromises and the Government announced various schemes to strengthen and give the much-needed boost to the automobile sector," the note stated. SMC has a price target of 2,047 in 8 to 10 months’ time frame.

Welspun India: The Buy rating with a price target of 193 comes as the company remains committed in its long-term aspiration of delivering sustainable and profitable volume led growth, the brokerage said.

Prestige Estates: “Despite the challenging environment, Prestige has clocked highest quarterly sales and collections. The new sales were backed by the healthy response to its newly launched project, Prestige Great Acres and the existing inventories across geographies. Thus, it is expected that the stock will see a price target of 529."

KEC International: As per the brokerage, the company is doing well and the management believes T&D domestic, Railways and Civil segment would be the main growth drivers. Thus, it is expected that the stock will see a price target of 555 in 8 to 10 months.

Phillips Carbon Black: “The volume growth may be driven by improvement in freight movement along with steady pace of road construction, pick-up in mining activity amid government focus on infrastructure and continued e-commerce demand and it would also be aided by prospects for import substitution." SMC has a Buy with a target price of 294.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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