Diwali Picks 2025: Axis Direct Lists Nine Stocks With Upto 23% Upside Potential

Axis Direct has rolled out its Diwali 2025 stock recommendations, identifying nine companies with long-term potential. It is bullish on these stocks, driven by earnings visibility and expansion-led growth.

The top picks include Rainbow Children’s, DOMS, KEC International, Chalet Hotels, Minda Corporation, Kotak Mahindra Bank, Federal Bank, JSW Energy, and Coforge. 

Let’s take a look at Axis’ stock bets to light up your portfolio this festive season:

Rainbow Children’s Medicare: The company is debt-free, generating robust cashflows (around ₹1,100 - ₹1,200 crore FY26–28E) to self-fund expansions. With strong occupancy trends and margin expansion expected as new facilities mature, Rainbow targets double-digit revenue growth with sustained 32–33% EBITDA margins.

DCF-based valuation implies a target price of ₹1,625, offering 23% upside.

DOMS Industries: DOMS Industries is a stationery and art products manufacturer. With product diversification, premiumisation, and distribution growth, DOMS expects FY25–28E revenue, EBITDA, and profit after tax CAGR of 23%, 22% and 25%, respectively. Valued at 58x March 28E EPS, the stock has a target price of ₹3,110, implying 22% upside.

KEC International: With an order book of ₹34,409 crore, and a robust L1 pipeline worth ₹40,000 crore, it has strong revenue visibility for 18–24 months.

The company expects ₹30,000 crore order inflows in FY26, supported by domestic and international T&D projects. Margin improvement is expected through high-value international assignments, while debt reduction strengthens profitability.

KEC projects 15% CAGR revenue growth FY25–27E with EBITDA margins improving to 9% by FY27. The stock has a price target of ₹1,030, offering 20% upside.

Chalet Hotels: High occupancy at 75% - 80% and strong ARR growth are supported by limited Tier-1 supply additions. Planned ₹2,000 crore capex is largely funded internally while maintaining leverage at 3.5x EBITDA. The stock is valued has a target price of ₹1,120, implying a 19% upside.

Minda Corporation: The automotive components manufacturer has planned ₹2,000 crore in capex over five years, including new die-casting and instrument cluster plants. With export revenue expected to grow 37% CAGR to ₹1,500 crore by FY30, the company’s prospects are firm.

With revenue, EBITDA, and PAT CAGR of 13%, 16%, and 22% over FY25–28E, respectively, Minda’s target price of ₹690 has an upside of 19%.

Kotak Mahindra Bank: Credit costs are expected to taper as stress in MFI (Microfinance Institution) and retail CV portfolios eases. Margin compression has moderated due to repo rate cuts and improved deposit mix, with net interest margins projected at 4.9% - 5% by FY27–28.

The stock has a target price of ₹2,500, indicating a 17% upside.

Federal Bank: With a stable asset quality and credit costs expected at 55bps for FY26, growth is expected to pick up from H2FY26. Federal Bank’s price target of ₹240 implies a 16% upside, supported by steady asset quality and improving NIM trajectory.

JSW Energy: The company has a locked-in portfolio of 30.5 GW, with 57% in renewables and 11 GW under construction. It targets 30 GW capacity, 40 GWh storage by FY30, and carbon neutrality by 2050. Trading at 14x forward EV/EBITDA, it has a ₹625 target price, implying a 15% upside.

Coforge: Strategic capex and AI-focused data centres ($65 million in Q1FY26) ensure strong revenue visibility. Executable order book for the next 12 months is $1.6 billion, up 47% from the previous year. 

Disclaimer: The views and opinions expressed are those of the SEBI-registered analyst/advisor mentioned in the article, and are not endorsed by Stocktwits. This is not investment advice. Please do your own research or consult a financial advisor.

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