Gurmeet Chadha continues to be positive on 4 auto component stocks; here’s why
Gurmeet Chadha of Complete Circle Consultants, points out that there is news of Sona BLW buying the railway arm from Escorts Kubota and doing a QIP there. Their market share in differentiated gear is almost 55-60% in PVs and 75% in CVS. The heavy gears they make are amongst the best in class and the EV portfolio has traction motors. The BSGs also seem to be doing well. Chadha also slike Precision Camshafts that has 60% market share in camshafts. Plus, they continue to have exposure in Uno Minda and Sandhar Technologies.
Which are the sectors that are not going to rotate and where there is both value and growth visibility?
Gurmeet Chadha: In the correction that has happened in the market, there will be a lot of chemical names where something may not happen immediately, but the destocking probably should get over. For example, there are some APIs; the solvent prices are down, the destocking is almost done, and something may not come immediately but the US Biosecure law and one or two good quarters can re-rotate some of the good names like Aarti, Deepak, and Tata Chemicals. Soda ash prices are down.
Similarly, there could be some opportunity in FMCG names, where in my view, the growth has been single-digit digit but one can pre-empt that. A lot of focus is coming on the rural economy, there is a bit of stress which we saw, some of the impact coming in in the elections, a lot of government policies are now geared towards that and we have a very strong festive season.
In food companies like Tata Consumer and LT Foods,
