CHEMICAL SECTOR
Brokerage View: Chemical stocks ripe for fresh up-cycle
“These stocks have either reversed from a long-term support or made a multiyear breakout retest which make them quite safe as compared to the stocks which are witnessing a breakout which can fail if the markets correct,” said InCred’s VP, Gaurav Bissa, in a client note.
Is it a good time to play the urban consumption theme? Samit Vartak answers
When a lot of chemical companies went through huge capacity expansion and then it is impacting the margins significantly and so maybe it is not the right time yet but there will be time but similar if you see the capacity expansion happening across many of these companies, just look at the number of QIPs which are coming and they will go through similar fate what chemical companies went through before, so one needs to be careful on that.
Which are the best asset classes to own over 1-year, 3-year & 5 years? Nilesh Shah answers
Nilesh Shah says up to one year, he will recommend an arbitrage fund for a high taxpayer or debt funds, money market funds and short-term bond funds where one could have the limited benefit of a drop in interest rates. Between one to three years, one can go towards longer duration bond funds. Post-budget, one can also look at investment in precious metal.
Vinay Paharia on 4 sectors that may provide good opportunities for solid returns
Now, in the last one year, we have seen a huge outperformance of companies in the low quality and low growth basket. It is in this space where the valuations have actually significantly re-rated and most of the companies are now trading at a materially higher level in terms of valuations compared to their longer-term averages.
2 top stock recommendations from CA Rudramurthy BV
So, you have to be in the right sector and yes, there are lot of good stocks in these sectors which I can give as input and I am very clear this market is a buy on every dip, no shorting whatsoever but however I will also tell you managing leverage, managing your quantity and being in the right stock and sectors is very-very important because the trigger should not wash you out of the market. Being in the game is very important to win the game.
Auto, auto ancillary sector a good theme to play the rural recovery: Devang Mehta
Some of the FMCG participants also came in this analyst guidance that most of these companies are now trying to come back and there was a decent volume growth which is seen.
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Green shoots of rural recovery? Bet on these 3 sectors, says Jyotivardhan Jaipuria
Jyotivardhan Jaipuria says both the largecap and the smallcap segments look attractive. In areas where the capacities are in place, where they are running at low utilisation, if demand recovers, then huge operating leverage can be made, those are the companies which we are really focusing on.
Stock Radar: Traders could consider Deepak Nitrite after a swift 20% rally from June low; could hit fresh 52-week high
Deepak Nitrite Ltd, a specialty chemical stock, witnessed a swift 20% rally from the June low, making it a tactical buy at current levels. Short-term traders with high-risk profiles could look at buying the stock on dips for a target of 2,800-3,000 levels in the next few months, as suggested by experts.
Bet on largecap, index stocks; try and take your portfolio to safer sectors: Dipan Mehta
The larger ones, the large banks, the large IT companies, the large pharma companies, they are still in that ballpark figure of 15 times to 30-35 times trailing 12-month price to earning multiple.
Market poised for uptrend with phases of consolidation: Sudip Bandyopadhyay
So, once the tractor volume starts picking up, we will see further upside in M&M. The company has done fantastic early well as far as the SUV business is concerned. They have done well in other smaller segments as well, including farm equipments. But performance in tractors was promising and that will be icing on the cake as and when it happens.
Sanjiv Bhasin picks 3 sectors that may outperform in near term
The overall benign environment remains that you have to be a little neutral over here. I think technology, pharma and FMCG -- those are the favoured sector on seasonality, on US cues, and on local demographics.
Anshul Saigal on sectors where investors can deploy fresh money
You could find opportunities in banking space in the 5 to 10 times price to earnings rate. I would not call that expensive by any measure. So, there are reasonable opportunities in the market to take advantage of.
Fertiliser, agrochemical stocks rally as monsoon arrives early
Fertiliser and agrochemical companies like FACT, Nova Agritech, and Rallis India saw a boost in shares as the monsoons arrived early. Analysts expect increased demand for products due to favorable weather conditions, with specific bullish recommendations for Coromandel International and other companies.
Are fears and panic around PSUs overblown? Sandip Sabharwal answers
Ideally, they should not be able to because like you rightly said, it is more commoditised. In fact, you look at the reason why did HDFC merge into HDFC Bank, because they realised that the margins are going to get squeezed and if they do not have a low-cost deposit franchise which supports the margin squeeze, that will become tougher.So, many of these housing finance companies sustain higher margins to develop financing, loan against property, etc, which are higher margin, but then also carry higher risk.
Manufacturing theme offers a diversified portfolio. Anthony Heredia explains how
We believe the Production Linked incentive (PLI) along with the need for global corporates to de-risk their China play offers a secular opportunity that is likely to pan out over the next 3-5-7 years. Government is also monitoring the PLI implementation, making necessary changes if needed to resolve any problem areas as well as adding more products covered under PLI.
Niteen S Dharmawat on 3 high conviction themes to bet on for next few years
From highest conviction perspective, the chemical and agrochemical sector that I mentioned, then infrastructure is another sector where we will see many investments coming in.
2 top stock recommendations from Aditya Arora
Although the kind of standard deviation move which it had in last two days is on the extreme side compared to last let us say 400 average days of the move, so in the short term it has run up quite a lot but if we look at the medium term, then yes still a lot of steam left over there fresh bull market starting over there so that is pretty much sorted and market will take time to decide which new sectors will do well, which sectors will not do well depending on what kind of policy which comes ahead, etc.
Will finally all the hard work yield results in Modi 3.0? 7 fertilizer stocks with 4 having ‘buy’ reco and upside upside potential of up to 22%
Few months back when it was announced that the fertilizer subsidy bill was seen as lower than expected, the street reacted negatively. The assumption is that if the fertilizer subsidy is going to come down then it is bad for the sector. Now there is another way to look at it, a government which has been ensuring that agriculture gets the right amount of attention and doing the various policy pushes, then why is the overall projected subsidy bill down? Probably, it may be because the government is expecting that policy actions which it has taken over the years will yield results and some of the other non-financial efforts which it will take in the sector will help reduce the bill without having an adverse effect on any stakeholders. Now unlike other sectors like railways where putting more money or making few policy changes has helped the sector, fertilizer is a more complex sector and is bound to take more time for getting the house in order. But then who says that transition for good is painless.
What to expect from RIL stock going ahead? Deven Choksey answers
To a greater extent likes of Reliance, likes of Bajaj Finance, likes of Kotak Bank are some of the companies where probably you find that the business condition remains absolutely upbeat and robust and at the same time the stock prices have not moved anywhere despite of the rally going on in this market.
ETMarkets Smart Talk: Chemicals & CRAMS sectors likely to get re-rated in FY25: Nimesh Chandan
Nimesh Chandan discusses FII selling, Nifty earnings estimates stability, and the potential for continued growth in the Real Estate sector post-election results. Chandan further says that largecap stocks currently offer a better risk-to-reward ratio compared to midcaps and smallcaps. He says: " On the business side, we expect chemicals and CRAMS(Contract research and manufacturing services) sectors, which has been an underperformer for the past few years, to get re-rated as business improves this year."
Bad news flow & good stock prices: 5 agro-chemical stocks with upside potential of up to 30%
What is the news flow regarding the agrochemical sector today? Probably the following: China is dumping, there is over capacity in many segments, over inventory issues are plaguing the industry globally, erratic weather conditions in different parts of the world. One would feel agro chemical stocks are better avoided now. But in markets, when the news flow is bad, stock prices are probably good. Also, in the case of the agro chemicals sector, it's mostly short term issues. So, it is time to keep them on the watch list.
Identify themes ahead of the curve; current year could belong to telecom: Niket Shah, Motilal Oswal MF
Niket Shah of Motilal Oswal MF discusses investment themes like AI in Indian IT, re-rating opportunities in EV and medical devices, and triggers in the telecom sector such as 5G adoption and pricing strategies.
Which companies can benefit from US-China spat? Rohan Gupta answers
Rohan Gupta from Nuvama Institutional Equities discusses the recovery in the agrochemical sector, specialty chemical players' performance, and the impact of the China factor on the market. Gupta says that the companies which are completely dependent on agrochemicals globally, may still see some weakness, like UPL or even Anupam Rasayan.
Markets moving away from consumption themes to investment themes: Manish Sonthalia
But otherwise, automobiles, banks, pharmaceuticals, capital goods they have all delivered on numbers. Metals and oil and gas was again supposed to be muted. So, I think all in all, the expectation of the result season from where we began the earnings season was a 5% to 6% earnings growth for this quarter.
3 stocks Hemang Jani is bullish on from capital goods sector
LIC Housing, in terms of the asset quality, they have done reasonably well. Top line growth was slightly lower than market expectations and we believe that NBFCs as a space can do very well given that we are going to have a slightly stable kind of interest rate environment.
Dipan Mehta gives a hard pass to specialty chemicals; will bet on agrochem stocks
Dipan Mehta discusses the cautious outlook on chemicals, interest in agrochemical plays, auto sector trends, high PE ratios in capital goods, potential investments post-election, mixed earnings season results, and concerns about overvalued EMS companies. Mehta also says: "If the government comes back with a stable majority, then the best stocks to buy would be the defence stocks, PSUs. It could be PSU banks or the PSU engineering companies."
Waiting with cash in hand; will invest once election results are out on June 4: Aveek Mitra
Aveek Mitra of Aveksat Financial Advisory strategizes for post-election investments, considering policy changes, Budget implications, and real estate opportunities in the MMR region for long-term growth. Mitra says: "We have built up different scenarios with most likeliest scenarios to the not likeliest scenario and based on that we will immediately try to see that what best we can do with the cash after the 4th June result."
Bullish on smaller and midcap auto ancillaries and capital goods companies: Daljeet Singh Kohli
Daljeet Singh Kohli, of Vasuki India Fund, advises diversified investment in auto theme through ancillaries to avoid overexposure. Emphasizes on mid-sized capital goods companies for growth potential amidst market volatility. Kohli says: "We are not doing anything in our portfolio, we are just sitting tight looking at day-to-day activity in the market."
4 stocks Rohan Gupta is bullish on from chemical sector
I do not say that these structural drivers were missing. It is just about that the sector was out of the flavour from last four to five quarters because of the near-term headwinds. But now it looks like the headwinds are over and we should be seeing the sequential recovery in place while the structural driver are already in place.
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