Tea stocks extremely trading oriented

CNBC-TV18s Executive Editor, Udayan Mukherjee -  Tea prices have gone up and there is such a lot of interest in playing commodities right now particularly the non-metal commodities in the world. So people are latching on to all of them.

You have seen fertilisers do well now, tea is doing well and tea prices have gone up by Rs 10-15. So some of that move is certainly legitimate. Tea stocks are by definition extremely trading oriented. So it is not like mutual funds are buying or FIIs are buying a lot of tea stocks, traders are. You just need to keep a handle on where these stock prices are going because if you look at the last few weeks many of these tea stocks have gone up between 25-50%.
 
So there is a big rise, which has happened already on the back of the commodity price rise and while McLeod Russel might be inexpensive stock, still trading at single-digit PE multiples. Some of these other stocks are actually quite expensive. So when they go up they all go up 15-20% together, people don’t look at which individual valuation they are trading at. But the time has come where you start looking at which tea stock to buy if you want to ride it.
 
Aside of tea, I think you might see some interest in other commodities as well. Fertiliser has its own problems but you might see a bit of a churn away and who knows maybe sugar is waiting for a bit of a move up again because that seems to be the pattern which is playing out in some of these commodity stocks.