KYI: Nirmal Bang gets stock specific for long-term

ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets Infosys BSE | NSE 01/06/12 Are Mutual Funds betting on Infosys? Other Stocks in this news State Bank of India | Unitech | Tata Steel | SpiceJet |

Know Your Investment, helps investors take a prudent call on their investments. This week, Mehraboon Irani, Principal & Head-Pvt Client Group Business, Nirmal Bang Securities gives his take on various sectors and stocks.

So, what should the strategy be for investors to follow going forward?

Moneycontrol.com's initiative, Know Your Investment, brings you answers to the queries you asked us on our Facebook page.

Rajesh Nair: Can we buy Infosys now?

A: Yes. I have always believed that in a scenario where the Indian rupee could end up ruling higher (on an average) in 2012-13 as compared to what it is in 2011-12, a frontline IT stock is a must in an investor's portfolio and the choice should be restricted between an Infosys or a TCS among the bigger companies. After the share price correction, Infosys offers a good defensive bet for investors, with a   limited downside, if any (temporary).

Shakesha Vali: How good is SBI ?

A: A distinct stress is brewing in the banking sector. Even though the earnings have been good, the quality of earnings has deteriorated considerably. Over the last year, there has been a 100% growth in NPAs and a threefold increase in the growth of gross impaired assets.

However, the same is not getting reflected in the numbers of some of the PSU banks.

Today, nearly 80% of the total NPAs of the banking sectors are in infrastructure, real estate and priority sector lending. Add to this, the impending power sectors problems - the mounting losses of distribution companies and probable payment defaults of state electricity boards - and one can sadly conclude that all is not well within the banking sector.

SBI, being the leader, could also be impacted on account of the same. However, the stock has corrected significantly from its 52-week high and barring any unexpected NPA issues, maximum downside is a couple of hundred rupees from the present level.

Vikas Singh: What is your call on Unitech ?

A: The company is heavily leveraged and needs to take care of its balance sheet, though one needs to accept that the management is taking steps to improve the operational performance. However, in the present challenging times, one would do well to avoid heavily-leveraged companies like Unitech.

Kumud Bajaj Dubey: I have 100 shares of Tata Steel at an average price of Rs 600. Are there any chances of it reaching that level again?

A: An investor has to learn to support a good company in bad times. The stock had gone all the way down to Rs 330. If one would had averaged at Rs 350 levels (by buying 200 shares) and would had sold it off today at Rs 420, the net gain of Rs 14,000 would have had reduced your original acquisition cost to Rs 460. Therefore, without waiting for Rs 600 to come, try and buy in the event of any sharp decline in the market and the stock is available lower, and sell it on advances and reduce your final cost of holding.

Abhinav Sharma: I want to enter the market. Which stocks should I invest in for two-three years?

A: Arshiya International, Delta Corp, Vivimed Labs, HDFC Bank and IndusInd Bank.

Narender Tiwari: Could you recommend some smallcaps shares for long-term?

A: Ashiana Housing, Vivimed Labs, Cerebra Integrated and Lloyds Steel.

Vikram Salaria: Which sector will be a star performer this year?

A: I believe in continuing to be defensive in this calendar year also. So, my preferred sectors would be consumption-oriented and pharma (select stocks).

Aditya Mltv: What is your call on SpiceJet ?

A 15: Aviation is  a capital intensive sector. Barring one unlisted player, all are incurring losses. Over the last one year, more than three-fourths of the market capitalization  has been shaved off. Therefore, the stock has come down quite sharply over the last 18 months and the negatives could have been discounted. However, this is not to infer that I am recommending the stock.