Mangesh Bhadang of Nirmal Bang Securities and Sandeep Upadhyay of Centrum Capital are optimistic on the infrastructure sector.
“There is more steam left in infrastructure stocks or the construction stocks to move up further,” said Bhadang said in an interview with CNBC-TV18.
“We are looking at large awarding activity from NHAI. I think there is more legs to this rally from hereon,” he said.
Centrum’s Upadhyay said, “Since August or September, we have seen a resurgence in terms of bidding activity and that is what is showing on the order book of the likes of PNC Infratech and KNR Construction as far as the road sector goes. As the order book gets better, the government has been very conscious about making their model more conducive according to the market conditions.”
“The next rally perhaps should come from the infrastructure stocks given that they have been underplayed so far,” Upadhyay said.
PNC Infratech and KNR Constructions are the top picks in the sector, Bhadang said. “Both have very good revenue visibility for the next two-three years. The risk reward ratio is extremely favourite. Those stocks trade at a relatively higher valuation. Both these stocks look good to grow their revenue as well as PAT at a decent rate of more than 20 percent for the next two-three years,” he mentioned.
“These are two companies which stand out in terms of maintaining the financial discipline,” Upadhyay said.
For entire discussion, watch video...
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