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As Diwali lights begin to come on, brokerages are once again rolling out their stock pick ritual, promising to brighten investors’ portfolios. But how many of last year’s festive bets actually lit them up? Not many, it turns out. Nearly two-thirds lost value, with almost a third shedding more than 25%. Yet, interestingly, more than half still managed to beat the Sensex, shows a Mint analysis.
In the analysis, of the 148 stocks recommended by 40 brokerages for Diwali 2025 shows that nearly 63% declined from last Diwali till date (20 October 2025 and 30 October 2026). Yet 53.4%, outperformed the Sensex, which fell 11.7% over the period. Almost a third of the picks lost more than a quarter of their value.
Sandip Jha, chief product officer at Godrej Wealth outlines that outperformance is useful information, it should never be used to explain away a loss.
Jha said recommendations should be assessed on absolute returns, performance against a relevant benchmark over the same period, and the risk taken. Investors must also distinguish between a sound business undergoing a valuation correction, and one whose fundamentals are deteriorating.
The 2025 Diwali picks had the highest proportion of Sensex-beaters across the three annual sets analyzed by Mint, with each year's Diwali recommendations seen over the subsequent one-year period. This share of outperformers rose from 36% for the 2024 picks and 49% for the 2023 selections. But only 37% of last year’s picks delivered positive returns.
The contrast with the Diwali 2023 recommendations is sharp. Of the 45 stocks analyzed, 80% gained and 20% declined over a period when the Sensex advanced about 22%. Yet only 48.9% of the picks outperformed the benchmark.
The following year proved tougher. Of the 59 stocks recommended for Diwali 2024, 58% gained and 42% declined. However, only 35.6% beat the Sensex’s 3% return, while 64.4% lagged the index.
Summing up the festive sentiment, Lokesh Manik, senior analyst at Vallum Capital, said, “A Diwali date is a ritual, not an investment reason.”
“Investors should judge recommendations on both absolute and relative returns. A high-beta stock that falls less than a falling market has not shown skill. Judge the whole list by hit rate and median return, not a few big winners," he said. "Measure from your own entry price, against a benchmark and over the stated horizon, since most picks are 12-month calls.”
Among the 148 stocks recommended for Diwali 2025, steep declines were nearly twice as common as similarly large gains. As many as 45 stocks lost more than 25%, against 23 that gained more than 25%. Another 30 declined between 10% and 25%, while 18 lost up to 10%.
On the winning side, 12 stocks gained between 10% and 25%, while 20 scrips rose by up to 10%. In all, 75 recommendations fell more than 10%, compared with 35 that gained more than 10%.
Some losses were particularly severe. RMC Switchgears and Oswal Pumps shed nearly three-quarters of their value, falling 74.5% and 73.3%, respectively. Khaitan Chemicals & Fertilizers, Elin Electronics and KP Energy declined between 62.6% and 65.5%.
A handful of winners stood out. Fredun Pharmaceuticals surged 150%, Acutaas Chemicals 123.9% and Syrma SGS Technology by 107.7%. SG Finserve and Bharat Heavy Electricals rose 79.3% and 65.7%, respectively.
The sector breakdown showed a similar divide. Consumer durables picks recorded a median loss of 32%, followed by infrastructure and engineering at 24%. The median fall in oil and gas recommendations was 12%, while IT services lost 5%.
Power led the seven groups analyzed with a median gain of 10%, followed by pharma and healthcare at 4% and banking, financial services and insurance at 2%.
Rishabh Nahar, partner and fund manager at Qode Advisors, cautioned that a widely recommended stock may already reflect much of the optimism surrounding its business. “By the time a stock becomes a popular buy across the sell side, a large part of the underlying optimism may already be reflected in its price,” he said.
Familiar names dominate the overlap across brokerages’ Diwali 2026 lists. Eternal is a pick of four brokerages—JM Financial, Motilal Oswal, Kotak Neo and Geojit. ICICI Bank features on three lists, while Titan, Larsen & Toubro and Kotak Mahindra Bank appear on two each.
Power remains in favour. JM Financial has selected Power Grid, while Bajaj Broking is backing Adani Power, CG Power & Industrial Solutions and GE Vernova T&D India.
JM Financial Services said amid geopolitical uncertainty and elevated mid- and smallcap valuations, we favour a balance of largecaps offering valuation comfort after sharp falls and midcaps with earnings visibility.
“Defence, power transmission, telecom and pharma are defensive themes with little direct crude sensitivity while banks gain if lower oil eases inflation,” the brokerage said.
For investors, the task begins where the recommendation ends.
Jha of Godrej Wealth said buyers should examine earnings visibility, balance sheet strength, management quality and valuation, and establish a review and exit strategy before investing. A falling price alone need not invalidate a sound business, but weaker earnings prospects, deteriorating finances or doubts over management warrant reassessment.
Nahar from Qode Advisors also warned against allowing the purchase price to dictate the decision to hold or sell. Investors should revisit the original rationale and judge whether the expected returns still compensate for the risks.
He has a parting reminder. “Investors should remember that a stock recommendation is not a Diwali gift hamper, just because someone has packaged it attractively doesn’t mean you have to take it home!”
Mayur Bhalerao is a markets reporter at Mint with around 12 years of experience across finance and media. His coverage focuses on Indian equities, IPOs and broader market trends, tracking developments across large-cap, mid-cap and small-cap stocks as well as shifts in investor behaviour among retail investors, mutual funds and foreign portfolio investors.<br><br>Mayur’s reporting emphasises data-driven analysis of market movements, valuations and sectoral trends. He uses shareholding disclosures, financial filings and market data to explain developments on Dalal Street and examine how global events and domestic policy changes—including geopolitical tensions, crude oil prices and regulatory decisions—shape Indian equities and investor sentiment.<br><br>He regularly uses financial databases such as the Bloomberg terminal and Capitaline to produce data-intensive stories, analysing company disclosures, ownership patterns and sectoral trends across both Indian and global markets. He also supports colleagues in the newsroom by providing database-driven insights and market data analysis that help strengthen broader market coverage.<br><br>Before joining Mint, Mayur worked at Informist Media Pvt Ltd., a leading financial newswire, where he developed his expertise in financial journalism in a specialised markets newsroom.
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