Emami is a decent bet if one considers the stock for a slightly long-term, said Girish Pai, head of research at Nirmal Bang Institutional Equities, in an interview with CNBC-TV18 on Tuesday.
“While we have not liked the business from a core perspective but the stock has come off substantially from where we initiated the coverage on a year back. So right now, I think there is value in Emami in our opinion, so it could be a good bet if you take a slightly long-term perspective... not the best in the lot from a quality perspective but having fallen this much, I think it is a decent bet to take," he said.
Speaking about the resolution process for non-banking financial companies (NBFCs), Pai said, “I think the government is not open to capitalising... those weak entities or those entities which have taken the wrong calls in terms of lending – they probably need to suffer and that will probably take at least two-three quarter for you to see they flush out of the system. So this problem will continue to fester but a large part of it is priced in."
On the real estate sector, Pai added, “One needs to look at where the core residential real estate market is. I think that is facing a lot of problems. There is a big inventory which needs to be liquidated over a period of time. Right now, the sales numbers based on what I am hearing from my real estate analysts are very poor. It is across the board, it is not just Mumbai situation, it is a pan-India kind of a situation."
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