In the limelight: Sparkling

We collectively look forward to Diwali, a time for celebration, family and friends and gluttony. The after effects of the festival, though, stretch beyond despairing over your depleted bank balance and the alarming increase your weighing scales show.

However, getting you to spend your money is what businesses strive for, especially, during the festive season, seeing that it ranks at the top of the auspicious day list. From retail to sugar, a number of sectors look forward to the festive season to provide an impetus to sales. So here are a few sectors and stocks that have a ‘Diwali' ring to them and which we think should ideally fire up during the festival.

Shopping season

Well, what fun is a festival if you don't buy new clothes? Hence , apparel retailers such as Pantaloon, Shoppers Stop, Trent, Kewal Kiran, Brandhouse Retail and Provogue should see more people flocking to their stores. The hypermarket chains of some retailers, such as Pantaloon's Big Bazaar too has many an offer going on for the festival season.

While we're at it, why stop at clothes? Diwali is an auspicious time to buy gold and jewellery. Titan Industries with its flagship Tanishq, and Gitanjali Gems with its bouquet of brands such as Nakshatra, Gili and Asmi, should ideally do well from this buying tendency.

Apart from jewellery, consumers tend to make other big-ticket purchases around this time, such as appliances, televisions and cameras. Therefore, companies in the consumer durables space such as Whirlpool, Videocon and Hitachi could see a spike in footfalls during the festival season. Durables makers further nudge sales in this period by introducing a host of offers, such as Whirlpool's scratch-and-win-gift scheme.

Large purchases also include cars and bikes. Automakers such as Mahindra and Mahindra, Tata Motors and Maruti Suzuki may see more life in sales as dealers push offers to lure customers. Further, with gifting forming a vital part of the festival, companies such as Archies and Nestle may see a spurt in sales of cards, gift and sweets.

Indirect benefits

A spike in consumer spending is clearly the most direct impact of the Diwali season. The Diwali effect, however, could stretch to other sectors too. For instance, with people travelling to meet up with family and friends, air travel may increase, especially with the dates being rather non-negotiable. Therefore, listed airline players such as Jet Airways, Kingfisher Airlines and Spice Jet could see bookings going up close to Diwali.

Those who are not quite the celebrating kinds could skip festivities and head for a movie. Eros International Media, PVR and Inox Leisure could benefit from the movie-going crowd. People may also use the holiday time to take a vacation, helping the likes of Cox & Kings, Thomas Cook, Mahindra Holidays, EIH and so on. Even pizza-maker Jubilant Foodworks could see a flurry of home deliveries, its bastion, as families order in after a tiring evening of setting off fireworks.

And as people cook up a storm of sweets to give away or to eat themselves, demand for sugar may surge. Companies in the sugar space, such as Balrampur Chini, Bajaj Hindusthan, Shree Renuka Sugars and others stand to benefit from this. The ‘sweet' factor could also help companies such as Hatsun Agro and Vadilal.

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