AEROSPACE AND DEFENCE PSU
First among equals: 5 PSU stocks which have benefited the most due to government policy push, spending & may continue their journey
Right from perennial under-performers like oil marketing and refining companies to PSU banks. Literally every stock which has the tag of “PSU” stock has seen a re-rating in the last two years. Now that the exit polls are predicting what the street has been looking for, that is continuity in the policy making framework, there is a high probability that there will be another round of re-rating of PSU stocks. So, continued policy and continued re-rating. Like the earlier re-rating, this time also, some sectors and stocks in the PSU space will outperform others. A company which is going to be providing finance for the expansion of the solar energy network which is the next focus area of the government. The overall demand runway for some of the sectors is longer. This essentially means that while every PSU is likely to see a push, there are a select few which are likely to see more tailwinds of business growth and valuation expansion.
Defence stocks: Long runway, hedge a bit to avoid narrative-based decisions; 8 PSU & Pvt sector stocks, 4 with upside potential of upto 44%
In an election season, there are bound to be times when one or the other narrative may make one question about whether one should sell the stocks. The underlying reason would be fear of losing the gains on which one is sitting. Especially when it comes to sectors like defence, railways and others which have seen a strong re-rating and siting with big gains and already there has been skepticism about their stock price moving ahead of time. Now let's look at the issue in two ways, first is whether the fundamentals of the sector are on a strong foot and business is fine or not. Second, how to hedge the exposure so that one is not forced to sell due to narrative, because the fact is that a continuation in policy push means that the companies have just started their journey. While defence PSUs are well known, there are other private sector players, whose lifeline is dependent on defence expenditure and in the last few years they have also done well, both on the street and in terms of real business. So, it is better that one should hedge and stay with them and not get jittery because of one or the other narrative which will keep hitting the street till 4th June.
Candidates of strong directional move on 4th June: 5 PSU stocks which have benefited the most due to government policy push and spending
In the last two years, it is a well known fact that every PSU stock has been re-rated by the street, right from perennial under-performers like oil marketing and refining oil companies to PSU banks. But if one looks a bit deeper there are some which have been re-rated more than others. The reason, these are PSUs which are from the sectors where the government has clearly decided are its priority areas and there has been a policy push for these sectors. A company which is going to be providing finance for the expansion of the solar energy network which is the next focus of the government. The overall demand runway for these sectors is longer which means overall growth will be higher when confirmation of policy continuity comes. Also they are in business where it would be difficult for the private sector to compete. Now because it is the policy push which matters, the continuity of tailwinds of higher government spending, will push them for another round of re-rating on the result day.
Defence stocks: Stay bullish, just hedge a bit to avoid narrative-based decisions; 4 stocks with upside potential of up to 33%
One of the sectors which has seen strongest re-rating in the last four years has been defence. Now in the last few days, the way markets have corrected and a narrative has come on the street that it is poll jitters which is making FPI sell, without realizing the fact that after a strong phase of upward movement, the global money tends to move in one from one country to another, especially in emerging market segment, it might lead to a situation where one might end up selling the long term winner early because of the narrative. Rather than getting jittery, it would be better to create a hedge and stay with the stocks where there has been a big change in the fundamental ways things operate.
Bet on PSUs only if bullish on India growth story; never in the short-term: Anand Sharma
Anand Sharma discusses the extensive impact of public sector enterprises in various sectors under government control, emphasizing the wide theme of PSU equity with a focus on power, oil, financials, logistics, metals, and mining. Sharma says , PSU equity fund is a thematic fund and should be a smaller part of any investors investable corpus.
HAL, NAL sign tech transfer pact for Tejas engine day door production
With the signing of the technology transfer for Bismaleimide (BMI) Engine Bay Door (EBD), HAL can directly produce these high temperature resistant composite parts for the series production of LCA Mk1A aircraft meeting the initial requirement of IAF squadrons, a joint statement said.
Skepticism on stock price vs tailwinds of policy push: 4 defence sector stocks with upside potential of up to 26%
In the last four years of bull run, among the PSU space, defence was the first sector to see a re-rating, infact it was the sector which led back the resurgence of the PSU space which was then followed by railways and then NBFCs which are lending to particular sectors. Now the fact that the defence stocks have run up sharply and sitting with gains, questions are bound to come on whether they have priced all the positives or not. A part of the answers lies in looking at how the stock behaved in recent times and whether the macro operating picture of the sector has changed or not. On the price front, in the corrective move of March, after initial correction due to profit booking, some of the defence stocks have once again moved upward and are quoting close to all time high, indicating demand for the paper from this sector. On the fundamental front, the operating matrix is better and probably it is one of the sectors where the continuation in policy making will have the biggest positive impact.
Guns N' Growth: Inside defence sector's explosive Make-In-India story
India's 'Make in India' defence production success story is evident in record-breaking defence exports, reaching Rs 21,083 crore in 2023-24, a growth of 32.5% from the previous fiscal. With a focus on indigenisation, India aims to triple annual defence production by 2028-29 and double defence exports to Rs 50,000 crore.
Tailwinds of policy push: 5 largecap PSU stocks from different sectors with an upside potential of up to 32%
While there are clear signs of large cap stocks making a comeback on the street, it is reflected both in movement of Nifty sensex. The problem is that as a word the “large cap” is so open ended and we keep seeing stocks moving in and out of that category which are the ones which one should focus on. If one looks at the last six months of the stock market moves, a new industrial house appears to be born and has caught the fancy of the street. Yes, we are talking about PSU as a set of companies. It is not owned by one individual but by the government of India so there is an element of the largest shareholder being one entity and that is why it may be called a new industrial house. Beside the ownership another common thread running in these companies is the impact of the clean up and restructuring of policy framework which has come in different sectors and in these companies in particular. So there is high probability and yes only high probability of these stocks doing relatively better in stormy conditions on the street.
Getting ready for another round of re-rating ? 6 defence stocks with “buy” recos with upside potential of up to 34%
As other sectors dominated by PSU companies come into limelight, defence stocks which ignited the re-rating of PSU stocks have moved into consolidation mode for some time. The question is whether the business is in consolidation mode or not, the answer is tilting toward no. It appears the underlying developments in the sector continue to be going at the same pace or rather even more. Allowing 100 % FDI in space related industries, is probably an indication that focus on defence and related sectors continues. As things are shaping up, it appears the exports would also become a focus area.
Looking to invest in PSUs ? Have the right mix of expectations as the risk rewards equation is very different in these 45 public sector stocks
If one looks at the last three months of the stock market moves, a new industrial house appears to be born and has caught the fancy of the street. Yes, we are talking about PSU as a set of companies. It is not owned by one individual but by the government of India so there is an element of the largest shareholder being one entity and that is why it may be called a new industrial house. Stocks which have been listed for years and till a year back were available at dividend yield of 6 % and no one was ready to look at them. They have suddenly caught the fancy.
BEL receives additional orders worth Rs 1034.31 crore
The Bengaluru-based company had also received an order worth Rs 339.31 crore, related to Combat Management System, Composite Communication System, Transmit / Receive Modules, Mobile Autonomous Stabilization System and other spares / services. Its cumulative orders are now up to Rs 27,647.31 crore for the current fiscal year 2023-24.
Investing in PSUs: Risks are of a different nature and so is reward for these 45 public sector stocks
Few years back, for a PSU stock to do well there was an unwritten rule on Dalal street. Is that company a divestment candidate? If yes, then the street would look at in a positive manner otherwise it was a no go area. Nobody on the street was interested in looking at whether the company is growing at a good enough rate, what the business was, whether it had any moat or not. Over the years, as no divestment took place, interest in PSU came down. The only time there was some activity at these stocks was when dividends were announced as the yield was high in these stocks. But then all of sudden things changed. In the last nine months, PSU stocks are the new stars of Dalal street. Will 2024 see the continuation of this trend ?
Nifty public sector enterprise index stocks: A re-rating of different kinds. Will it sustain and create wealth?
The recent re-rating of PSU stocks has happened due to multiple reasons. Right from realization on the street that to paint everything to same brush just because they are owned by government and ignore the fact the growth element is probably not right approach to the fact that there are some business where cost of capital and policy factor are loaded in their favour of PSU and that will not change any time soon.
PSUs will continue to ride momentum in 2024; 2 stocks to ace manufacturing cycle: Neeraj Chadawar
Neeraj Chadawar says: “We are identifying the stocks which are contributing to the ancillary demand of the manufacturing cycle. One stock which we identified is Amber Enterprises. The next is Sansera Engineering. This is auto ancillary company and in over a year this company has de-risked its portfolio which was earlier concentrated into IC engine.”
Booster Shot! Govt's capex pill turns 13 PSU stocks multibaggers in 2023; will marathon continue next year?
On a year-to-date basis, the S&P BSE PSU index has rallied more than 50% and scaled a lifetime high of 15,531 earlier this week. Meanwhile, the benchmark Sensex has given a little over 16% returns in the same period. A significant chunk of the gains in PSU stocks came in December, with as many as 28 of them clocking double-digit gains, after the strong victory for the Bharatiya Janata Party (BJP) in the state assembly elections of Chhattisgarh, Madhya Pradesh, and Rajasthan.
Beneficiary of policy continuity; 5 defence stocks having upside potential of up to 40%
There are many sectors which are dependent on the policy push by the government, but defence as a sector which has come into focus in the last three years is probably more impacted by policy direction as the government is the biggest spender on defence and it this government focus on indigestion that has changed the fortune of the domestic defence manufacturer and contractor. Probably that is the reason why after state elections as the street felt that there is high probability of continuity in policy post May 24, defence stocks are the ones which again inched upward. With the assumption that policy push will continue, will the re-rating continue?
Defence PSU shows signs of exhaustion as entertainment company goes bearish
The stock of this PSU has had a near-vertical rise in the past three months. The stock price has appreciated by more than 40%. Recently the price has been struggling to hold on to the upside and is displaying signs of profit booking. It has formed a bearish Marubozu candlestick which suggests further downside in the short term.
This defence PSU stock nearly tripled investor wealth in 5 years
HAL (Hindustan Aeronautics Limited) is a state-owned aerospace and defence company that has seen strong investor interest in its stock in the past 5 years. The company hit a lifetime high of Rs 3,168 earlier this month. Hindustan Aeronautics is one of the stocks in the defence sector that has seen the most consistent investor interest.
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