After days of wait and anticipation, the Union Budget for the upcoming fiscal year has been announced. The budget can be regarded as progressive but not populist, as anticipated by the market.
The market reaction (NIFTY) towards the budget announcements was largely positive, as could be witnessed from the movements on the budget days and post that. Besides this, NIFTY sectoral indices moved in a positive direction, except for the Auto sector on the budget day.
After the buzz around the announcements (of the budget) has finally started to fade, it is time for the investors to recoup and look forward to making some crucial changes in their portfolios. One of the steps this year’s budget would have a long view of the investments, budgets and include some vital stocks in the profile. Here are five such stocks that the investors might be looking forward to stacking post-budget:
- Ashok Leyland (NSE: ASHOKLEY):Ashok Leyland Ltd (ALL) is one of the leading players in the Indian CV industry with a ~28% market share in the MHCV segment in FY21. The CV segment has held up well in the current year despite challenges and improvement in business sentiments along with spending on infrastructure are likely to drive demand in the medium term. FY21 MHCV industry production volumes have been at the lowest levels seen in ~12 years and we believe that the company is ideally placed to capture the growth revival in the CV segment. We believe that ALL will be one of the biggest beneficiary of the Governments spends on infrastructure and voluntary scrappage policy.
- Kalpataru Power (NSE: KALPATPOWR): The company is engaged in power, infrastructure, and asset creation sectors in domestic and international markets. Kalpataru’s Standalone order book has seen some weakness in the recent times as the raw material volatility in commodity prices has led to more cautious approach in bidding as well as overall weakeness in domestic T&D. However, Kalpataru’s civil/infra EPC co. (JMC) has been witnessing robust inflows in FY22 and should provide support to consolidated order book and revenues. Moreover, prospects for domestic railways remains intact and its International T&D (LMG+Fasttel) continue to perform well. Lifting of restrictions for World Bank projects should also provide support.
- JK Lakshmi Cement (NSE: JKLAKSHMI): Another stock to watch post-budget shall be JK Lakshmi Cement, a leading cement producer in the country with strong presence in the key markets of North and West India as well as high growth East market. JK Lakshmi is one of the lowest cost producers stands to benefit from improving demand outlook in the near term, especially after the recent quarter which saw impact of extended monsoon, and specific event like transporters strike in Chhattisgarh plant. With regional issues in the rear view mirror and general improvement in demand scenario aided by strong impetus on infra/construction, we believe that both volume and pricing outlook would turn favorable. The investors shall continue enjoying high ROE as the expectations are around 18% (ROE) in FY 2023.
- Sobha Limited (NSE: SOBHA): Another company to watch out for during the next couple of years shall be the Bengaluru-based Sobha Limited, a real estate developer in India. The company operates in Residential and Commercial real-estate along with Contractual business. 70% of residential pre-sales for Sobha comes from the Bangalore market which is the main IT hub in India and we expect new hiring by the IT industry will increase residential demand in the South India market. Ready to move inventory and under construction inventory levels have moved down to their lowest levels of last 7-8 years. Customers are now having a preference towards branded players like Sobha Developers. The company expects to launch 17 new projects/phases spread over 12.56mn sqft across various geographies. The majority of launches will be coming from the existing land bank of approximately. 200mn Sqft of salable area.
Oberoi Realty (NSE: OBEROIRLTY):
This is another real estate company stock the market is extremely bullish for. The market position and capitalisation of the company is extremely strong. Oberoi Realty is a real-estate company, focuses on MMR region. Company having business vertices of residential and commercial real-estate. Company has reported a strong set of numbers in Q3FY22, we expect residential real-estate growth momentum to continue for the next couple of quarters as in Q4FY22 company has launched Elysian Tower B in Goregaon along with this upcoming launch of Thane by FY23. Diversified Revenue Mix – Company owns Oberoi Mall (0.5 msf), Commerz (1.1 msf) and the west in hotel (269 room keys). We expect occupancy levels to improve in CY2022.
Robust launch pipeline – Company expect to launch Thane residential project by FY23 along with this Borivali project. Consolidation in Real-estate – We have seen good consolidation in across India towards top-10 players. Top-10 players now holds 11.2% market share as compared to 5.4% in 2017. We believes that top-10 players will continue to gain market share.
Summing up
These stocks have not only shown a stellar performance on the exchanges in the past couple of years; these five companies are also fundamentally strong and have a good market base. The overall goodwill of the companies is also strong, and the investors, based on the market trends, expect a significant bullish movement in the next few months. Hence, if an investor is looking forward to diversifying the portfolio and adding some high-yielding stocks for the next couple of years, these could be some of the best alternatives available.
This article was shared with Prittle Prattle News as a Press Release.
