Let us address what is going on within the cement space owing to the fact that UltraTech has certainly been in focus on the back of their massive expansion plans. Walk us through how you are looking at large cap cement companies and do you think that UltraTech would emerge as one of the top bets in this space?
I think the cement pack has done quite well in the last quarter. Looking at the dispatch numbers and the quarterly performance, one thing is very clear that this performance is likely to continue for at least next three-four quarters.
Being the largest player in this space, the upcoming expansion plan of UltraTech is a very welcome move and there is definitely a lot of money to be made in this stock.
I think there could be around 15-20 per cent more upside in the large cap names like UltraTech but I would still play Grasim for a proxy to an UltraTech where the valuation and overall value looks much better.
Secondly, I think if you look at the midcap cement names as well, they are obviously going to benefit a lot. So I think one stock name that we have been recommending is Birla Corp. So overall cement as a basket looks very-very convincing from here.
Do you believe that there is money to be made in lot of midcap IT names and which are the stocks within this universe that you would prefer?
I think one of the most important thing to notice here is the way these stocks have performed in recent months.
I think IT and pharma look very promising as we see the visibility of earnings in them. So I think in IT obviously we are very overweight on IT pack and I think midcap IT space as a whole should outperform.
So yes, our top idea remains Mindtree. I think also some more money can be made in specialised small IT companies like Tata Elxsi and Coforge.
What is your take when it comes to Spice, IndiGo and the overall aviation sector? What would you conclude from A) the fact that traffic does seem to be picking up and now we have actually got further capacity allowed B) what is your say on the last quarterly numbers for both companies?
The IndiGo stock has rallied quite a bit in the last few sessions and I still feel that there could be upside. But I would avoid going long on IndiGo or SpiceJet at this juncture. I feel there should be some more consolidation in these stocks so I would avoid buying any aviation stock at this point.