Varun Lohchab’s 6 top investment ideas in IT and financials

economictimes.indiatimes.com:

Varun Lohchab, Head of Research- Institutional Equities, HDFC Securities, says “Axis Bank, ICICI Bank, Chola, LTI, Mindtree, Persistent are the top picks within banking and IT pack which still look reasonably valued and within the capex theme there are a lot of ideas as well.”

Lohchab also says: “A lot of the stocks are looking expensive from a next 12-month perspective and that is why one needs to have more moderate return expectations in some of those preferred themes. Some names like Cummins, NCC, Sobha Developers, DLF, NTPC among the power utilities and CESC are some of the ideas where as a house we are still positive and we have them as part of our modern portfolio.”


Let us begin by discussing the market momentum. What is your near-term as well as medium-term outlook on the market?
Near-term, markets are looking fully valued, which has been our call for the last two-three months after this rally to almost 20,000 levels on Nifty. From here on, over the next six-nine months, upsides at the index level look fairly limited. That is why the action has shifted a lot to smallcaps and midcaps. Definitely, at the beginning of the year, they were looking more attractive than the largecaps, which was our call.

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After this move, frankly, even small and midcaps are not looking like a basket case. Things have moved up out there. But still we are able to find some investment ideas across all market caps. But one should moderate or temper their return expectations from the market over