No to metals as a basket, yes to these 2 stocks: Chakri Lokapriya
Chakri Lokapriya, CIO & MD, TCG AMC, says “metals as a basket has underperformed. Valuations are attractive but the business momentum is just not there because of global uncertainty. Jindal Steel and Power valuation is still probably about five times EV/EBITDA. While we would stay away from the sector, may go for a couple of companies like Jindal Steel and Power and maybe Hindalco.”
As we are now gearing up for the festive season, it definitely is going to be very critical for a lot of these consumer durable companies across the board. What is it that you are anticipating from this festive season and the kind of cheer it could bring for FMCG companies?
FMCG companies, probably in terms of consumer staple, not much other than the traditional bounce.
Companies which have usually underperformed, companies like Crompton Consumer, Voltas, companies which have done nothing fundamentally and valuation wise for the last one or two years. They simply have not gotten their product portfolio right, no pricing power, no margin, etc. The recent spending by the consumer for the August 15th weekend, if it is any sign of indication for the festive season, will show that these consumer electronics companies will begin to make a comeback.
So these companies including Havells, Crompton Consumer look okay.
We have discussed power stocks but I want to go back to power utilities, not power capex, not power ancillaries, not power service providers like REC and PFC, which give financing. I am specifically talking about this whole comparison of solar versus thermal. There is a Tata Power, which is not expanding in thermal and there is an NTPC, which is expanding in thermal. Which way would you vote, clean energy or fossil fuel fired plants?
I think
