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We have seen the PSU bank index actually kind of outperform the benchmarks, also the Nifty Bank for the most part of the week. Where do you see PSU bank headed from here on, do you think that they will stage that continued outperformance going ahead? Amongst the PSU bank names, are you liking any other names apart from or because those have been top favourites for most of the analysts of late?
Definitely PSU banking space will be performing well going ahead because the biggest reason is the margins. I think margins will expand in coming quarters because of the rising interest rate scenario. It will definitely improve their margins going forward. We believe in the PSU banking space as you rightly said that SBI and
are all time favourites and SBI is all time favourite for us also in the same space. But we believe PSU banking space is more of a play with the short-term perspective because many of them, whenever traction comes up and builds up in the PSU banking space, definitely perform but with the short term perspective.
Although having said that, we have the most of our conviction on the private banking space with the long-term perspective.
Let us talk about the auto sector. Week gone by has been extremely good for the auto index as well. Second best performing sector as what it had registered but come next week or come this week we will also have the auto numbers come in from November 1st onwards which will give an indication of how the festive season has been for the auto sector, what are your assumptions for that particular space?
Well we are very positive on the automobile space. Starting from the Navaratri times to the Diwali if you look at the passenger vehicle space, the sales numbers have had a 45% jump around four lakh cars which have been sold.
So auto has been seeing strong demand on the ground and the channel checks also suggest the same. But we believe automobile plus auto ancillary both segments look quite interesting to us. It will continue to clock in. We have been seeing a lot of demand coming by the end of November, December, also because of the depreciation benefit and so on and so forth so I believe auto will be a good performer.
Amongst the auto space in the passenger vehicle space I think
is a good addition to that M&M is quite good. On the auto ancillary space we are quite positive on Craftsman Automation added to that we are very positive on UNO Minda kind of stories. So we believe auto ancillary also added to the OEMs will perform well in the coming two quarters.
What about the entire new-age listing and tech platform kind of space because has been coming under pressure, it is below the Rs 1000 mark now, of course, below the issue price as well and to add to that you have Delhivery which has been coming under pressure, it is down 30% in the last one week, one month itself and you also have other names like , etc, that were quite soft in the week gone by, do they become a buy given the correction or would you still avoid this space?
Well I would like to avoid the space not giving a blanket reason to all the stocks but every company has its own reason. If you talk about Delhivery, they have their internal issues in terms of their ordering and delivering platform where there was a lot of chaos and tedious processes where the systems went off and the processes went off so that was one of the reasons.
Apart from that, Zomato as we know that market is not liking the valuation still so every stock has its own story behind but I would not be excited and interested despite the stocks having fallen so much. I would still like to go with those companies, new-age businesses the likes of
, which is more of a productive kind of a business model where it is a per click, per transaction kind of model. So I would like to put my neck out and buy those kinds of stories which are very lucrative, profit making from day one and have a good balance sheet.
What are your picks for the coming week?
My picks would be more based on the investments to be done for the next 9 to 12 months. One is from the banking space which is
. It looks quite interesting, numbers are very strong. I think 19% loan growth, NIMs were better, 50% odd net profit jump. So we recommend a buy with a target of 150.
In the domestic consumption space, what I like is Polycab. We would like to recommend a buy with a target of 3389.
So these two companies look quite interesting. But the unique play from the chemicals is also what I am looking at. Anupam Rasayan is also an attractive buy with a target of 940.
The last stock which I would like to talk about is in the FMCG consumption arena which is
. We recommend a buy for the stock with the target of 2140.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)
