Sharing his views on how the Supreme Court's recent verdict on adjusted gross revenue (AGR) will impact the telecom stocks, Sanjiv Bhasin, Executive VP, IIFL Securities, said that Vodafone is likely to be under pain for at least a quarter while Bharti Airtel could hit new highs if there is some relief from the government on the issue.
“It is very easy to write off Vodafone, I still think that there is enough room for all three to gather market share. Only the numbers will take a quarter or so more for Vodafone to be under pain. Grasim as a holding company at Rs 700 has enough risk-reward. I would rather play Grasim than try and punt on Vodafone, but clearly the market leader is Reliance which is hitting new highs and Bharti Airtel will follow suit if they get some relief from the government because their market share and volumes have been very strong in the unaudited numbers which they gave yesterday," Bhasin said in an interview with CNBC-TV18.
On the auto sector, he said, “It tells you that if you bought fear in the last two months, you are handsomely rewarded by the most hated sector. Tata Motors is up 40 percent, Maruti Suzuki is up... Eicher Motors is up from Rs 16,000 to Rs 22,000... Tata Motors is clear that the trade talks are now seeing a resolution... JLR is performing well there. Even their Slovakia unit in Europe should start to see some more traction. We think that going ahead this scrappage policy could be the real icing on the cake if it does get through after November 15th. So, all-in-all the pessimisms has given a huge short-covering rally."
Speaking about construction space, he said, “Along with pessimism there is a lot of optimism in select companies. Godrej Properties, Prestige Estates, Sobha and DLF... DLF from Rs 140 has moved to Rs 180 so you will have to take it with a little bit of sucker that we have already seen a rally but I think that real estate and construction stocks can be the real beta for 2020 that include the likes of Dilip Buildcon, NCC, NBCC where I think order execution now and the government flows of order will be a huge impetus going into the next one year.”
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