Stock market expert SP Tulsian of sptulsian.com on Thursday said he is bullish on public sector undertaking (PSU) banks, namely State Bank of India (SBI), Bank of Baroda, Canara Bank and Punjab National Bank (PNB).
“Two stocks which come to my mind are SRF and Apollo Hospitals Enterprises. Both these stocks are quite a high beta. However, now SRF ran towards the upper end of the valuation range and I won’t be surprised to see if it is correcting. In spite of good Q3 numbers, probably the market will use that as a trigger to go for profit booking. So my caution now at the current level of Rs 3,400 remain away and it may be risky to enter into the stock at the current level," Tulsian said.
About gold financiers, he said, "We have been continuously recommending Manappuram Finance. We have not recommended Muthoot Finance the way we have recommended for Manappuram Finance and that has been seen the star performer for 2019. But we have been taking a call that probably Muthoot at Rs 725 and Manappuram at Rs 175-178 is again seen to be as there is no point in chasing the momentum."
"Those who have bought Manappuram earlier at Rs 150-155 could book profits at Rs 175 and similar was a call on Muthoot Finance. So, for the time being, we have been keeping a cautious view or avoid. We are not giving a buy call. However, other NBFCs like Mahindra & Mahindra Financial Services or L&T Finance Holdings that are rural-focused and things seems to be on a recovery stage as their exposure is getting increased in the consumer space or because of their exposure seen to be in rural areas," he added.
On the auto sector, he said, "The larger funds may be taking exposure in Mahindra CIE or Bharat Forge or maybe Motherson Sumi. But, the smaller auto ancillary stocks can give good appreciation as they all seem to be ruling virtually at a lower end of valuation range and earnings seems to be picking up in FY21."
Talking on YES Bank, Tulsian said the stock is seen as a high risk-high return and we are recommending it, "We are not comfortable on capital raising plan getting crystalized to the extent of $1 billion."