February 2024

In the dynamic landscape of the stock market, PSU stocks have been a topic of discussion lately. In a recent interview on CNBC TV18, Nilesh Shah from Envision Capital and Dharmesh Mehta of Dam Capital Advisors shared insights into the challenging valuations of PSU stocks. This article delves into the key points discussed during the interview, providing a detailed analysis of the current scenario and potential future trends.

Adani Enterprise, Reliance, and LT Performance:

The discussion began with a brief overview of Adani Enterprises’ recent financial results. The company reported a significant surge in net profit, more than doubling to 1800 CR. The positive performance contributed to a notable rise in the stock’s value. Meanwhile, other major players like Reliance Industries experienced buying momentum, while L&T faced challenges, becoming the top Nifty loser.

Concerns Surrounding PAYTM:

The conversation then shifted to the regulatory challenges faced by Paytm. According to Shah, the series of bad news for PAYTM has been ongoing for over a year. The recent developments, particularly regarding payments banks, pose a significant challenge that might persist for some time. Shah expressed skepticism about the stock’s potential growth, indicating a potential further decline in its value.

PSU Stocks Valuations:

Dharmesh Mehta from Dam Capital Advisors joined the discussion, highlighting the challenging valuations of PSU stocks. Shah echoed this sentiment, stating that PSU stocks, excluding PSU banks, appear over-stretched. The recent budget had a positive impact on PSU banks, but Shah emphasized the need for caution due to the rich valuations of other PSU stocks.

Also Read:

• Porinju Veliyath’s Insights on Budget 2024
• Budget 2024 Analysis with Vijay Kediya & Maneesh Dangi
• The Interim Budget With Arundhati Bhattacharya and Vinayak Chatterjee

Risks and Opportunities:

Shah acknowledged the potential structural changes in PSU stocks, anticipating them to become more significant enterprises in the next 5 to 10 years. However, he also emphasized the need for a cool-off in their valuations. While not advocating a severe sell-off, Shah suggested waiting for more favorable entry points.

Post-Election Divestment:

The conversation explored the impact of divestment post-elections on PSU stocks. Shah expressed optimism, stating that divestment is no longer perceived negatively. Instead, it is seen as an opportunity for institutional investors to deploy fresh liquidity. The divestment strategy has changed from being a capital-raising exercise to a positive narrative, potentially leading to higher weights in market indices.

Private Sector Capex and Economic Growth:

Shah discussed the shift in infrastructure investment dynamics. Previously, the government played a crucial role in anchoring investments. Now, with infrastructure becoming an attractive sector, private capital is expected to play a more significant role. Shah suggested that the government is passing the baton to the private sector, encouraging them to invest in infrastructure projects.

Outlook on Private Capex:

Regarding private capital expenditure (capex), Shah acknowledged that it has not yet picked up substantially. Despite the reduction in tax rates for manufacturing companies, private capex is lagging. Shah remains optimistic, foreseeing a potential increase in private sector capex in the coming months.

Conclusion:

In conclusion, the interview highlighted the challenges and opportunities in the current market scenario, specifically focusing on PSU stocks. Investors are urged to exercise caution due to stretched valuations while keeping an eye on potential structural changes and the evolving narrative around divestment. The interplay between public and private sector investments will be crucial in shaping the future landscape of the stock market.

Porinju Veliyath, a seasoned investor, shares invaluable insights on India’s economic landscape in relation to Budget 2024. He sheds light on the nation’s resilience amid global uncertainty, emphasizing the transformative ‘Amrit Kaal’ vision that promises a civilizational rise over the next 25 years. In an interview with ET Now, Porinju Veliyath’s views on Budget 2024.

1. Economic Backdrop: India’s Strength Amid Global Uncertainty

Porinju Veliyath begins by analyzing India’s robust economic position in the face of global uncertainty. He draws attention to the clear demarcation between India’s internal reforms and global geopolitical shifts, positioning the country as a formidable player on the world stage.

2. ‘Amrit Kaal’ Vision: A Civilizational Rise Over 25 Years

Porinju introduces the visionary ‘Amrit Kaal’ concept, envisioning a significant civilizational rise for India over the next 25 years. This forward-looking vision underscores a commitment to long-term economic growth and development beyond the confines of political cycles.

3. Investment Recommendations: Caution and Opportunities

While expressing caution about certain high-PE PSU stocks, Porinju recommends ONGC for its stability and expresses bullish sentiments on Piramal Pharma’s diversified portfolio. The discussion also touches on pockets of overvaluation and undervaluation in the market, guiding investors in navigating potential risks and opportunities.

4. PSU Stocks: The Oil and Gas Sector Opportunity

Porinju identifies an opportunity within PSU stocks, particularly in the oil and gas sector, with a specific focus on ONGC. He highlights the potential for earnings growth and the possibility of an 8-10% dividend yield in the coming years.

Also Read:

• Budget 2024 Analysis with Vijay Kediya & Maneesh Dangi
• RBI Takes Stern Action Against Paytm Payments Bank
• Challenges and Opportunities in PSU Stocks

5. Porinju Veliyath’s ‘Kulja Simson’ Wall: Wealth-Making Ideas

Introducing the concept of the ‘Kulja Simson’ Wall, Porinju emphasizes wealth-making ideas. He specifically mentions his bullish stance on ONGC and Piramal Pharma, portraying them as potential treasures for investors.

6. Prime Minister Meeting: Confidence in India’s Trajectory

Porinju shares insights from his meeting with the Prime Minister, expressing confidence in India’s trajectory. He commends the current regime’s adept utilization of positive global aspects, contributing to the nation’s growth and economic development.

Conclusion: A Once-in-a-Thousand-Year Opportunity

In conclusion, Porinju Veliyath’s analysis underscores the once-in-a-thousand-year opportunity presented by India’s demographic advantage and the ‘Amrit Kaal’ vision. Investors are encouraged to exercise caution amidst potential market corrections while exploring opportunities in undervalued sectors. Porinju’s optimism and confidence in India’s future provide a compelling narrative for long-term investors.

Disclaimer: The investment recommendations discussed in this article are based on Porinju Veliyath’s insights, and readers are encouraged to conduct their due diligence before making any investment decisions.

Explore insightful Budget 2024 analysis by experts Vijay Kediya & Maneesh Dangi. Gain valuable insights into the financial landscape.

As India braces itself for the economic roadmap laid out in the Interim Budget 2024, renowned financial experts Vijay Kediya and Maneesh Dangi recently shared their insights in an exclusive conversation with Nikunj Dalmia on ET Now. The discussion delved into various aspects of the budget, shedding light on the potential impact on markets, sectors, and investment strategies. Here is the Budget 2024 analysis by Vijay Kediya & Maneesh Dangi.

Understanding the Economic Landscape:

The conversation began with a lighthearted note as Nikunj Dalmia welcomed Vijay Kediya, emphasizing the significance of budget announcements on market dynamics. Vijay Kediya, known for his astute market observations, expressed his perspective on the budget, emphasizing that for the current government, every event is noteworthy. According to him, the government is likely to utilize this budget to provide direction and guidance, and possibly set the stage for India’s economic recovery.

Market Sentiment and Investment Strategy: Budget 2024 Analysis

Addressing the concerns related to taxes on dividends, capital gains, and Securities Transaction Tax (STT), Kediya acknowledged the challenges but stressed the government’s potential to use the budget constructively. He believed that even if some consider this budget a non-event, the government would seize the opportunity to offer guidance and create momentum.

In the Budget 2024 analysis, when asked about potential changes in investment strategies based on the budget, Kediya reassured viewers that his investment style wouldn’t be swayed by short-term budget fluctuations. He reiterated his confidence in India’s growth potential over the next five years, attributing it to the government’s strategic initiatives and the alignment of various factors.

Also Read:

• Porinju Veliyath’s Insights on Budget 2024
• Decoding Budget 2024
• RBI Takes Stern Action Against Paytm Payments Bank

India’s Last Chance for Phenomenal Growth:

Kediya expressed a bullish sentiment, emphasizing that the next five to ten years could be India’s final opportunity to make significant strides and catch up with global economic giants like China. In the Budget 2024 analysis, he highlighted the government’s understanding of this crucial phase, suggesting that India might adopt a similar development model to that of China.

Investment Picks and Sector Analysis:

Discussing specific investment choices, Kediya disclosed that he is fully invested in the market. He shared his belief in the margin of safety within his chosen stocks, indicating that the stories behind these investments are still unfolding, offering substantial growth potential.

Kediya discussed his optimism regarding the aviation sector, particularly Indigo, citing the management’s ability to navigate challenges and the sector’s overall growth potential. He also touched upon the energy sector, expressing interest in Oil Marketing Companies (OMCs) diversifying into hydrogen, aligning with global trends.

Insights from Maneesh Dangi:

On Budget 2024 analysis, Maneesh Dangi joined the conversation, providing insights into his investment preferences. He revealed his interest in metal stocks, particularly considering the ongoing infrastructure development. He emphasized the potential of the hydrogen sector and the importance of government spending in propelling various industries.

Dangi also addressed the impact of regulatory changes on the fintech space, highlighting the need for investors to stay informed about developments that could affect the financial sector.

Budget 2024 Analysis: Fiscal Numbers and Expectations:

The discussion shifted towards analyzing key fiscal numbers for the upcoming year. Dangi and Kediya discussed GDP growth assumptions, fiscal deficit expectations, and planned expenditure, providing a comprehensive overview of the economic landscape.

Dangi highlighted the cleanliness and transparency observed in recent budgets, emphasizing the government’s commitment to maintaining a clean fiscal policy. The experts discussed the potential impact on the bond market, predicting a positive rally if the fiscal deficit remains within certain thresholds

Stock Picks Based on Government Spending:

As the conversation concluded on Budget 2024 analysis, the experts shared their stock picks based on potential government spending. Sectors such as infrastructure, defense, and manufacturing were highlighted, with specific stock recommendations including L&T and defense-related companies.

The discussion offered valuable insights into the budget’s potential impact on various sectors and provided viewers with strategic investment perspectives for the upcoming fiscal year.

Conclusion:

As investors eagerly await the Interim Budget 2024, the insights from Vijay Kediya and Maneesh Dangi serve as a guide for navigating the dynamic economic landscape. Their optimism about India’s growth trajectory, coupled with strategic investment picks, provides a valuable perspective for those looking to capitalize on emerging opportunities in the market. The budget, considered by many as a pivotal moment, has the potential to shape India’s economic narrative for years to come.