Here is what market gurus and industry captains told CNBC-TV18 today on how they see the near-term play out
We have been focusing more on larger caps in the Indian market. The biggest risk going into 2021 is not the growth factors; it’s whether inflation will pick up and global central banks pulling back in terms of liquidity and if they do that then it’s a risk to equity markets.
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The commodity prices are likely to move up and it will bode well for metal stocks. I am also bullish on cement stocks because of the government’s focus on housing.
Andrew Holland, CEO, Avendus Capital Alternate Strategies
The demand in November has been same as October, which is good and it looks good till December end. Therefore, if there is a strong production there would be strong wholesales. We also find that there is more buying based on functionality in response to COVID phenomena rather than aspirational buying and that’s reflected in first time buyers going up and the additional car buying going up and replacement car buying coming down. The share of diesel cars is coming down. However, only in sports utility vehicle (SUV) segment as there is traction for diesel due to higher torque.
Shashank Srivastava, ED, Maruti Suzuki India
As long as we do not have any more disruptions and the second wave is manageable in its proportion, a 25 percent earnings growth just from normalisation of Q1 cannot be ruled out. Whether you speak to auto companies or pharma companies or consumer companies, nobody knows how December, January demand is going to be, the one thing everybody is telling you is that the inventory levels are very low.
Banks in India are all domestic-focused. The classic cyclical trend in India has always been banks. As with every sector, the large-caps or the frontlines first take the charge and if the conditions remain favorable then the smaller banks or the smaller NBFCs catch up as well.
Susmit Patodia, Associate Director and Fund Manager, Motilal Oswal AMC
There are no plans to raise capital. Since we have only one operating business the fundamentals and the plans do not change and the holding company doesn’t have any other operating business other than the bank. So everything that we have said in the context of the bank in the past or more recently, those remain unchanged. As far as growth is concerned, we need to wait for the second half of FY21 to be able to comment on loan growth.
We have been requesting RBI for the collapse of Non-Operative Financial Holding Company (NOFHC) structure. A reverse merger is the best option for collapsing the NOFHC structure.
Nitin Chugh, MD and CEO, Ujjivan Small Finance Bank
While there is a possibility of 25-30 percent rally in public sector undertaking (PSU) stocks – as they come back to mean averages as far as their P/Es are concerned – it is not going to be a secular growth story where investors can buy and hope that the stock will double/triple over a three-four year period. However, because of their attractiveness, you will see very strong trading rallies from time-to-time and investors who have a trading mindset will certainly look at participating in those trading rallies.
Dipan Mehta, Director, Elixir Equities
If the regulator pushes Shriram Transport Finance Company (to opt for banking license), then I don’t think Shriram City Union Finance can be a standalone NBFC in that sense. If it is allowed then we will prefer to remain separate but it depends on the regulator’s viewpoint.
YS Chakravarti, MD and CEO, Shriram City Union Finance
Nutrition segment and agri science have done exceedingly well, they have not had any impact of the COVID. Q1 was good, Q2 continue to be even better. Sequentially the material science has done much better than Q1. All our units are now running at capacity, there is no demand problem. There are some pricing issues in the market, especially in the export markets, but the broadly India is doing well, US is doing well, UK always did well all through the pandemic. Overall the momentum is positive. All sectors are now beginning to open up and with the news of vaccine and travel getting lifted up, we think we should be back to normal somewhere around Q2 of next year.
R Mukundan, MD & CEO, Tata Chemicals
We are seeing growth, we are seeing enquiries which are picking up. There are pockets where it has gone to the pre-COVID levels and some pockets are reaching there. What the data tells us is that we have seen the sharpest increase in urban, semi-urban and rural. Metros did take a little bit more time in terms of the pick-up. Various schemes launched by the government has helped the individuals, the MSME sector in terms of meeting their loan requirements. We haven’t seen any sharp increase in defaults. There is a slight increase but data is still coming in, so we won’t be able to give any numbers at this point of time.
Harshala Chandorkar, Chief Operating Officer, CIBIL
Growth in wiring harness business to depend on the acquisitions company undertakes. If you look at the history. I think that is a good indicator so the compound growth will continue to increase. We definitely see wire harness constantly growing plus we hope to do a couple of acquisitions in that space soon. So hopefully that will do even well than what we have achieved.
Laksh Vaaman Sehgal, VC, Motherson Group
Everybody turning bullish, market turning long, one should be little bit cautious on the market trend at least from an immediate trend perspective; we can take bigger call later when the trend develops but right now one should be careful about possible knee-jerk reaction
Rohit Srivastava of indiacharts.com
We are looking at maintaining our profit margins for the year. What we lose in terms of the topline growth for the current year, we would like to make up through the margins. We are at about 26 percent EBITDA for Q1, Q2, and hope to continue to maintain that for at least the better part of this year. We are seeing spends open up but are cautiously optimistic for the second half of this year.
Venkatraman Narayanan, Managing Director & CFO, Happiest Minds Technologies
We wanted to get through our IPO first because that was the focus and we wanted to make sure that we had that process underway. We have just started looking at the acquisition strategy, started talking to investment bankers. So, it is too early to have anything concrete to share. We would look at Europe for growth. Europe is about 11 percent of our total business. Anything that adds to that will help us.
Joseph Anantharaju, Executive Vice Chairman, Happiest Minds Technologies
This order by NCRTC is Rs 723 crore and it will be executed in around three to three and a half years’ time. Order inflow for the Q2 is around Rs 3,000 crore. We expect order inflow for FY21 to be around Rs 7,000 crore.
Sunil Kumar Chaudhary, Chairman and Managing Director, IRCON International
Under this MoU, we are committed to provide technology and engineering services for over 500 plants that will be set-up by different developers under SATAT. As and when the developers start to develop this program on their projects we will be there to provide them with technology and engineering services. As of now it is building positively in the same direction that we had order for two quarters as well.
Shishir Joshipura, MD & CEO of Praj Industries
I believe that State Bank of India, ITC and Tata Motors through DVR, are the three clear big caps that could lead and be the underpinnings of a big move in the markets. As long as scepticism remains as high as it is and people’s participation remains as low and those who are participating remain as uncomfortable as they are, the longevity of the bull market is assured.
N Jayakumar, Managing Director, Prime Securities
(Edited by : Abhishek Jha)