Manish Sonthalia, Head - Equities, PMS at Motilal Oswal AMCis of the view that the time is good to accumulate Eicher Motors, Bajaj Auto and Maruti Suzuki.
Manish Sonthalia, Head - Equities, PMS at Motilal Oswal AMC told CNBC-TV18, "Good time to still accumulate Eicher Motors, Bajaj Auto and Maruti Suzuki and more from the point of view of the fact that GST is coming and many of these items are going to see margin expansion because you were paying high rates of tax in the pre GST regime, with the new rates of tax there will be some saving on the total tax paid. Obviously, my belief is that there will be ways in which you can retain some of those margins and not pass it entirely to the customers."
"So, there is a case for margin expansion and you have to balance that with gross margin compression because commodity prices are on the up move when you look at it on a year on year basis. This will be a interplay on margins and on the top line it will not be only about volume growth, it will be also about pricing growth. So, nominal growth in sales leading to a higher operating leverage and flow down through the PAT, I think is not fully built in from next 2-3 years point of view.""So, definitely consumer discretionary is one of the main areas or consumption and in general should be the main focus area if you are looking at let us say 2019, 2020 or may be even 2022 point of view," he added.