Pankaj Pandey on his top 3 midcap and smallcap picks for 2024

economictimes.indiatimes.com:

Pankaj Pandey, Head Research, ICICIdirect.com, says: “We like U GRO Capital. It is a MSME lender. The overall expectation is that the AUM will grow at 50% odd and ROAs will inch up from 1% last year to 3%. We have a target price of Rs 350. We also like Green Ply with a target price of 295. Their MDF plant is operational, the capacity utilization for that should go up going forward and that should fetch better margins. We also like cement as a space, so Birla Corporation is another stock which we are liking with a target price of 1755.”
What did you make of the move that we saw within the entire real estate basket, given that it was a stellar up move across the board?
Pankaj Pandey: Real estate as a sector has a five, six year cycle, probably we are in the second year of that cycle but unlike 2003 to 2007, our sense is that you will see more of a measured growth both in volumes as well as in pricing, unlike the time earlier when the pricing had sort of gone up.

Now inventories have come down significantly if you look at the top seven cities, so it is down to about 17 months and our sense is that a good part of the rally is already there in most of the stock prices. But what we are liking is the ancillary segments, which is essentially a building material segment. So there we are liking Kajaria Ceramics, we have given a buy on Greenply because our sense is that when these deliveries start to happen in the next one year, the demand for these home building products should go up.