Moneycontrol
Sep 15, 2017 01:59 PM IST | Source: CNBC-TV18

Tata's next JLR could come from its consumer biz; many more L&Ts in the making: Porinju

Porinju Veliyath of Equity Intelligence India also said that there could be some small infrastructure companies that have huge potential in the coming years.

As the Indian market hovers around record milestones, with bouts of correction, several experts believe it is the liquidity that is keeping the bourses in good shape.

“Domestic flows have been supporting Indian markets and there is potential for household savings to enter financial markets as well,” Porinju Veliyath, MD & Portfolio Manager, Equity Intelligence India, told CNBC-TV18 in an interview. In fact, he said that the power of a middle class family was being underestimated in terms of household savings. Going forward, Veliyath sees a strong and steady rupee movement as well.

The right approach for investors, he said, would be midcaps and smallcaps which have immense turnaround potential. “There could be companies, which will be relevant, going forward,” he added.

Speaking on a sectoral basis, the smallcap equity veteran said that Tata Global Beverage is witnessing changes as the group realized that they have to focus on business. “The Group will now be looking for the next Tata Consultancy Services (TCS) and JLR that could come from its consumer business. So, I am bullish on Tata Chemicals, Tata Global and Tata Coffee,” he told the channel.

For infrastructure space, Veliyath said that there could be some small infrastructure companies that have huge growth potential in the coming years.

While domestic flows have risen, FIIs have been selling quite heavily in the past few months. Veliyath feels that it is a good move that FIIs are selling, which gives more opportunity for domestic investors.

Going forward, he expects the consumption theme to work, especially in the midcap space. Additionally, there could be some growth in rail companies in 3-5 years and there are many more L&Ts in the making, he said.

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