Yes, you do need a Demat account to take delivery and hold equity investments overnight. Kindly note that you cannot take delivery if you have linked another Demat account with a third party DP. For more information, you can read this article.
Do themes purchased through FYERS Thematic platform reflect in the Demat account?
Who can invest using Thematic Investing?
In what ways is Thematic Investing easier than regular investing in stocks?
What is a theme index?
How is a theme created?
How often are themes updated?