Diwali Picks 2026: 5 Stocks to Buy This Festive Season by SAHI Research

SAHI Research | Festive Edition | 4 November 2026

SAHI Research's Diwali Picks 2026 are five stocks to brighten your portfolio this festive season, each backed by a technical setup and a fundamental thesis. The list covers Zen Technologies, DLF, Adani Green Energy, BSE and HDFC Bank, with a buy range, stop loss and two targets for every stock. The horizon for all picks is a 1-to-6-month tactical swing.

Diwali Picks 2026 at a Glance

Horizon for all picks: 1-to-6-month tactical swing.

Diwali Pick 1 of 5: Zen Technologies Ltd (NSE: ZENTEC)

Theme: Indigenous Defence Technology & Execution Acceleration | Horizon: 1-to-6-month tactical swing

Zen Technologies Price Chart

Zen Technologies daily chart: double bottom breakout with a volume spurt and bullish RSI divergence.

Technical View

• Prior trend: The stock saw a huge rally from the start of 2023 and hit a record high of ₹2,627, after which profit taking set in.
• Healthy correction: The decline from the record high has been a healthy correction that cooled off the excesses of the earlier rally. After this correction, the stock is now showing signs of reversal.
• Double bottom breakout: The stock has formed a double bottom pattern on the daily time frame. This is a bullish reversal pattern in which price tests a support area twice and then breaks above the high between the two lows, signalling that sellers are losing control.
• Volume confirmation: The breakout is accompanied by a huge volume spurt. Strong participation behind the move adds credibility to the breakout.
• RSI bullish divergence: The RSI on the daily chart is showing bullish divergence, where momentum improves even as price tests lower levels. This indicates hidden strength in the counter.
• Trend reclaim: The stock has reclaimed all its key short-term DEMAs, suggesting the short-term trend has turned in favour of the buyers.

Tactical Quality Filter

The Catalysts

Fast-Track Procurement Execution
Zen has commenced delivery of Fast Track Procurement orders received during the previous year, ahead of contractual timelines. Q2 FY27 revenue increased 98.8% YoY to ₹345.13 Cr, reflecting accelerated execution of the existing order book. Management expects fresh counter-drone procurement tenders to progress over the coming months, with the earliest potential order awards around Q4 FY27. Faster execution capabilities and ownership of core technology position the company to respond quickly to evolving Armed Forces requirements.

Counter-Drone Procurement Opportunity
Rising requirements for counter-unmanned aerial systems (C-UAS) across border areas and critical infrastructure provide a significant addressable opportunity. Zen has developed indigenous anti-drone systems and has established product capabilities in this segment. Several defence procurement proposals have received Acceptance of Necessity, while approximately 82% of the recently approved capital acquisition proposals are earmarked for domestic sourcing. Conversion of these requirements into actual tenders and orders could provide substantial incremental order inflows, although the timing remains uncertain.

Scaling the Defence Technology Ecosystem
Beyond its traditional training simulators, Zen is expanding across counter-drone systems, naval solutions, robotics, autonomous vehicles and loitering-munition platforms. The broader portfolio allows it to participate in multiple defence procurement categories and reduces dependence on a single product segment. HyperStrike is currently undergoing internal trials, with management expecting a more meaningful contribution from FY28. Successful product development and subsequent procurement approvals could create additional growth opportunities.

Order Book Conversion and Execution
Q2 order inflows of ₹481.81 Cr exceeded execution of ₹345.13 Cr, taking the consolidated order book to ₹1,375.70 Cr. Management expects healthy revenue over the next couple of quarters, supported by the existing backlog. It also indicated that simulator orders worth approximately ₹400 Cr are reasonably likely, although these are not yet part of the confirmed order book. Continued execution alongside fresh simulator and counter-drone orders can support revenue visibility beyond the current quarter.

Thesis Risk

• Procurement delays: Counter-drone FTP tenders and simulator orders could be delayed, pushing expected incremental order inflows into FY28.
• Working capital: The 379-day working-capital cycle and negative H1 operating cash flow need to normalise as receivables are collected and the existing order book is executed.
• Execution and margins: Product-mix changes, higher R&D and warranty costs, or delays in delivery could affect operational margins and the pace of order-book conversion.

Diwali Pick 2 of 5: DLF Ltd (NSE: DLF)

Theme: Luxury Housing Demand & Revenue Recognition Inflection | Horizon: 1-to-6-month tactical swing

DLF Price Chart

DLF weekly chart: breakout from the multi-year falling channel and the six-month consolidation box.

Technical View

• Prior peak and correction: After hitting an all-time high of around ₹967 in April 2024, the stock saw a healthy correction during which it traded in a falling channel.
• Accumulation on OBV: Through this correction, the OBV (On Balance Volume) has risen consistently. A rising OBV while price corrects means volume on up days has outweighed volume on down days, which shows healthy accumulation in the stock.
• Tight consolidation: Over the past 6 months, the stock has traded in a tight range, building a base after the correction.
• Breakout from range and channel: This week the stock has shown signs of the end of this consolidation. The move has also resulted in a breakout from the falling channel that has formed over the last couple of years, marking a potential change in the medium-term trend.
• Momentum across time frames: The RSI on both the weekly and daily time frames is quoting above the 60 zone, indicating positive momentum in the counter on both the short and medium term.
• Trend reclaim: The stock has reclaimed all its key DEMAs, which suggests a positive trend.

Tactical Quality Filter

The Catalysts

Luxury Housing Demand and Pricing Power
Q2 FY27 sales bookings reached ₹3,800 Cr, supported by the complete sell-out of Aureva, which had a potential booking value of approximately ₹1,985 Cr. Dahlias also continued to see strong demand, with management indicating approximately 10% price appreciation during the quarter. Continued traction in super-luxury housing, supported by DLF's established brand and limited availability of comparable developments, can sustain premium realisations and project margins.

Project Completion and Revenue Recognition
DLF is approaching an important revenue-recognition inflection beginning FY27–FY28, led by The Arbour. This will be followed by a series of project completions, including the Privana developments and Dahlias over the subsequent years. As these projects reach completion and handover, the company expects a stronger conversion of earlier bookings into recognised revenue and reported earnings. This provides visibility into the next phase of development-business profitability.

Strong Cash Generation and Balance Sheet
DLF generated ₹1,858 Cr of operating cash flow in Q2 FY27, with collections of ₹2,780 Cr. Its reported net-cash position remained at ₹15,084 Cr despite a dividend payout of approximately ₹1,980 Cr during the quarter. Strong collections and disciplined capital allocation provide the financial flexibility to fund construction and future launches, although a substantial portion of reported cash is held in RERA accounts.

Recurring Rental Income
The group's approximately 50 million sq. ft. rental portfolio achieved its highest-ever occupancy of 96% by area and 97% by value. DCCDL reported 9% YoY EBITDA growth to ₹1,537 Cr in Q2 FY27. Continued rental growth, supported by high occupancy and upcoming commercial completions, provides a recurring earnings stream alongside residential development.

Thesis Risk

• Delays in regulatory approvals or project execution could defer upcoming launches and revenue recognition.
• Luxury housing demand could moderate, particularly at higher ticket sizes, affecting booking momentum and price realisations.
• The timing gap between pre-sales and accounting revenue recognition could keep reported revenue volatile.
• RERA-restricted cash limits the amount of the reported net-cash position available for unrestricted corporate deployment.
• DCCDL's debt and interest costs need to be monitored alongside rental income growth and new commercial asset commissioning.

Diwali Pick 3 of 5: Adani Green Energy Ltd (NSE: ADANIGREEN)

Theme: Renewable Capacity Expansion & Battery Storage Scale-up | Horizon: 1-to-6-month tactical swing

Adani Green Energy Price Chart

Adani Green Energy daily chart: bounce from the polarity zone and breakout above the upper Bollinger Band.

Technical View

• Demand at the polarity zone: The stock has seen a sharp bounce after testing its polarity zone of ₹1,150–1,220, an area where earlier resistance now acts as support. The bounce shows that buyers are interested in accumulating the stock and are defending this zone.
• Consolidation breakout: The stock has ended the consolidation that started at the beginning of August 2026.
• Bollinger Band confirmation: The breakout is validated by a move above the upper Bollinger Band along with band expansion. Expanding bands show an increase in volatility in the direction of the breakout.
• Momentum: The RSI is quoting above the 60 zone, indicating positive momentum in the counter.
• Trend reclaim: The stock has reclaimed all its key short-term DEMAs, suggesting a positive trend.

Tactical Quality Filter

The Catalysts

The Khavda Mega-Park Execution
AGEL's operational renewable portfolio at Khavda reached 10.75 GW, including 10 GW of its own generation capacity. The company is targeting 30 GW at the site by 2029. During H1 FY27, AGEL added 4,083 MW of renewable capacity on a YoY basis, demonstrating its execution capabilities across solar, wind and hybrid projects. Continued commissioning at Khavda can convert construction capex into incremental generation capacity and power-supply revenue.

Accelerating Power-Supply Growth
Q2 FY27 power-supply revenue increased 45% YoY to ₹4,019 Cr, while energy sales grew 33% to 12,090 MUs. Power-supply EBITDA increased 51% to ₹3,835 Cr, with segment margins expanding to 92%. The combination of higher operational capacity, increased energy generation and strong operating margins is supporting substantial earnings growth. Further capacity commissioning can sustain this momentum over the coming quarters.

Battery Storage Scale-up
AGEL added 3.08 GWh of BESS capacity at Khavda during Q2, taking cumulative installed capacity to 6.63 GWh, representing more than half of India's operational BESS capacity. Large-scale storage deployment can help address transmission-related curtailment, improve generation flexibility and support the integration of intermittent renewable energy. Management also indicated that the company could surpass its 10 GWh BESS capacity guidance for FY27.

Renewable Energy Infrastructure Expansion
With operational capacity at 20.8 GW and a longer-term target of 50 GW by 2030, AGEL is positioned to benefit from India's expanding renewable energy requirements. Its integrated solar, wind, hybrid and battery storage capabilities provide an opportunity to improve the reliability and dispatchability of renewable power. Continued execution and capacity commissioning remain the primary drivers of future revenue and EBITDA growth.

Thesis Risk

• Execution and transmission: Delays in transmission infrastructure, project commissioning or grid connectivity could defer capacity monetisation and increase curtailment.
• Leverage and capex: Net debt/run-rate EBITDA of 5.6x and substantial expansion capex create financing and cash-flow risks if commissioning or cash generation falls behind plan.
• Operating realisations: Changes in power-sale tariffs, generation conditions, counterparty payments or BESS utilisation could affect revenue growth and operating profitability.

Diwali Pick 4 of 5: BSE Ltd (NSE: BSE)

Theme: Derivatives Market Share Gains & Operating Leverage | Horizon: 1-to-6-month tactical swing

BSE Price Chart

BSE weekly chart: rising trendline support respected on four occasions since 2024.

Technical View

• Primary uptrend: The stock has been trading in a consistent uptrend since September 2024.
• Trendline support: The stock has respected its rising trendline on four occasions, and each test has been followed by a massive rally. Buyers have consistently stepped in on declines towards the trendline.
• Structure intact: This repeated behaviour shows that the bullish structure of the stock is intact.
• Trend reclaim: The stock has reclaimed all its key DEMAs, suggesting a positive trend in the counter.
• Momentum: The RSI on the daily time frame is quoting above the 60 zone, indicating positive momentum in the stock.

Tactical Quality Filter

The Catalysts

Derivatives Market Share Gains
BSE has been steadily expanding its presence in equity derivatives, particularly through its Sensex options franchise. Q2 FY27 average daily derivatives premium turnover increased 50% YoY to ₹2,25,307 million, despite a 24% sequential decline. Growing participation from brokers, retail investors and institutional participants can support further market-share gains. The key driver is not simply overall market growth, but BSE's ability to capture a larger share of India's equity derivatives activity.

Regulatory Normalisation and Trading Activity
The earlier Closing Auction Session framework created uncertainty around trading behaviour and derivatives settlement, contributing to lower market activity during Q2. SEBI announced a revised framework on October 15, 2026, with implementation scheduled from December 7. Greater clarity around market timings and settlement arrangements could support a gradual normalisation in trading activity. The actual impact on derivatives volumes and BSE's market share will need to be monitored.

Operating Leverage and Earnings Growth
Q2 FY27 operating EBITDA excluding Core SGF increased 42.4% YoY to ₹984 Cr, while the corresponding margin stood at approximately 68.7%. Transaction charges increased 42% YoY to ₹1,127.8 Cr, demonstrating the strong earnings potential of BSE's asset-light exchange model. Sustained transaction revenue growth, combined with operating-cost discipline, can support further earnings expansion.

Financialisation Beyond Trading
BSE's growth opportunity extends beyond equity and derivatives transactions. Its StAR MF platform had 307 million registered investors, 84,711 distributors and coverage across 721 cities and towns as of September 2026. H1 FY27 mutual fund revenue increased 11% YoY to ₹145.7 Cr, while order volumes grew 25%. Growth in mutual fund distribution, index services, data dissemination, listing and corporate services provides additional avenues to monetise India's expanding financial savings pool.

Thesis Risk

• Regulatory risk: Further restrictions on derivatives trading, changes in expiry structures or settlement rules could adversely affect transaction volumes and market share.
• Market activity and competition: A sustained decline in options premium turnover or stronger competitive responses from NSE could constrain transaction revenue growth.
• Earnings volatility: High dependence on transaction charges means that lower trading activity can quickly affect revenue and profitability despite the high operating margin.

Diwali Pick 5 of 5: HDFC Bank Ltd (NSE: HDFCBANK)

Theme: Post-Merger Normalisation & NIM Recovery | Horizon: 1-to-6-month tactical swing

HDFC Bank Price Chart

HDFC Bank weekly chart: reactions at the ₹680–700 demand zone and the Covid pivot zone (₹645.67).

Technical View

• Long-term structure: On the weekly chart (2019–2026), the stock moved from the Covid low of ₹369.37 (March 2020) through a sustained uptrend to the all-time high of ₹1,020, followed by a deep, prolonged corrective phase.
• Historical demand zone (₹680–700): This band has historically acted as a strong demand zone for the stock. Three separate tests since 2021 were each followed by a resumption of the uptrend, and the current correction has again tested this zone.
• Covid pivot support (₹630–650): The pivot zone at ₹645.67, the launchpad of the entire post-Covid rally, sits just below the demand zone. It is the make-or-break structural support for the long-term trend.
• Risk level: The stop loss of ₹620 is placed below the Covid pivot band. A sustained close below this level would invalidate the thesis and the multi-year pivot structure, and the position should be exited.

Key Levels to Track

Tactical Quality Filter

The Catalysts

NIM Recovery
Q2 FY27 NIM stood at 3.16% of total assets, down from 3.26% in Q1 FY27. Management indicated that margins have bottomed and expects an upward trajectory from Q3 FY27, supported by loan repricing and funding-cost adjustments. A sustained recovery in NIM would directly support NII growth and earnings acceleration.

Core Earnings Normalisation
Reported PAT grew 4.7% YoY to ₹19,510 Cr, while PAT excluding treasury trading gains increased 12.6%. The divergence highlights stronger underlying earnings momentum, with further improvement possible as margins recover and core banking income expands.

Retail & MSME Growth Acceleration
Retail disbursements crossed ₹90,000 Cr in Q2 FY27, compared with ₹76,000 Cr in Q1. Retail loans grew 11.7% YoY, while SME loans expanded 23.5%. Sustained momentum in these segments can support loan growth and improve the utilisation of the bank's distribution franchise.

Deposit Franchise Strengthening
Deposits grew 18.8% YoY, while CASA grew 10.8%. The addition of 1.7 million liability relationships during Q2 indicates improving customer acquisition momentum. Further improvement in CASA and deposit mix would help moderate funding costs and support margin recovery.

Thesis Risk

The setup weakens if NIM recovery is delayed beyond Q3 FY27, deposit growth remains dependent on higher-cost term deposits or loan growth outpaces sustainable liability mobilisation. Any deterioration in asset quality or failure to translate core earnings growth into reported PAT would also weaken the re-rating thesis.

Shubh Deepavali

Wishing you light, prosperity and a rewarding year in the markets.

Disclaimer

SAHI Research is a SEBI-registered Research Analyst. This report contains research recommendations based on technical and fundamental analysis as of 4 November 2026. Recommended price levels, stop losses and targets reflect our views on the report date and may change without notice. Past performance is not indicative of future returns. Investors should consider their own financial situation, investment objectives and risk appetite before acting on these recommendations.

Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investments in securities market are subject to market risks. Read all the related documents carefully before investing.

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