Sanjiv Bhasin, Director of IIFL Securities, believes that the leadership in the market has changed from banks to the IT and pharma sectors. This is evident from the new highs in the IT and pharma indices. He recommends being in large-cap banks as most FIIs are now underweight on banks. He also believes that Indiabulls Real Estate is one of the best reality plays and could potentially double in the longer term.
Regarding the market consolidation, Bhasin states that there has been some consolidation and stock-specific action, but he believes that the worst is over and it is time to be selective in stock picking. He mentions that the S&P and Japanese indices are at new highs, indicating overall market strength.
Bhasin advises investors to consider the private banking sector, particularly HDFC Bank, as it is currently undervalued. He also shares his positive outlook on Zomato, stating that it is a good long-term investment due to its strong margins and ability to adapt to changing consumer habits.
When asked about ITC, Bhasin suggests avoiding the stock for now due to uncertainty surrounding its divestment plans and the stake of British American Tobacco (BAT). He recommends being overweight on Britannia and Nestle in the FMCG sector.
Moving on to the insurance sector, Bhasin highlights the strong performance of PSUs like GIC, New India Assurance, and LIC. He believes that there is still room for upside in the insurance space and recommends considering LIC and private insurers like SBI Life, ICICI Pru, and HDFC Life in the portfolio.
Regarding SBI, Bhasin expects the stock to reach Rs 850 in the future. He mentions that SBI has just started its upward movement and highlights the positive outlook for private banks with good credit quality and low NPAs.
In terms of real estate, Bhasin advises holding on to Indiabulls Real Estate as it has the potential to double in the longer term. He mentions the upcoming court judgment regarding its merger with Embassy and believes that the stock is undervalued considering its land bank and new management.
In the pharma sector, Bhasin recommends Lupin and Dr. Reddy’s as top picks. He believes that the leadership has shifted from banks to IT and pharma sectors and advises investors to be in large-cap banks while most FIIs are underweight on them.
