Tulsian reviews ONGC, BHEL, Hexaware, Marico

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Tulsian reviews ONGC, BHEL, Hexaware, Marico

SP Tulsian of sptulsian.com in an interview to CNBC-TV18 spoke about stocks across various sectors like ONGC, Hexaware, Marico, Dabur and others.

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Excerpts from After the Bell on CNBC-TV18 Watch the full show » 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

SP Tulsian of sptulsian.com in an interview to CNBC-TV18 spoke about stocks across various sectors like ONGC , Hexaware , Marico , Dabur and others.

Below is the edited transcript of Tulsian's interview with CNBC-TV18. Also watch the accompanying video.

Q: What did you make of what Jaipal Reddy had to say about ONGC?

A: There seems a lot of confusion. The share is now ruling at Rs 275 and the institutional placement programme (IPP) guidelines have also come, so it is clear-cut indication that the government is keener to go for resource mobilisation. This is because IPP guidelines is not being followed for bringing down stakes in the companies where it is more than 90%.

That is the case with ten companies where valuations are unrealistic. One fails to understand that even at this stage when the share ruling at Rs 275 and there seems to be institutional appetite for the stock why the government is not keen to expedite this process? First they said that ONGC and BHEL are on scheduled and that creates unnecessary volatility in the share price. In my view it is definitely likely to happen.

I am not too sure about BHEL because I have been maintaining my reservation for BHEL and SAIL . In case of these two companies valuations are pathetically low, I don't see any meaning in government to initiate the divestment process at this stage. But in case of ONGC if they are able to succeed in getting 5% stake, then anywhere between Rs 260-280 is a good price. Government is likely to do it and that will happen in next 15 days because government itself will be keen to complete this process by March 31, so as to garner Rs 12,000-13,000 crore from this auction process of ONGC.

Q: What did you make of Hexaware's numbers and the big move that the stock has seen, do you anticipate more upside?

A: Numbers have been good. The guidance given by the company for CY12 is also very good, but we have seen a run-up in the stock. It has been hovering in a range of Rs 78 to Rs 86 for the last couple of months, but for last two days after this results have been announced, it has moved to Rs 97-98.

I don't think that it has legs to move beyond Rs 100 because what has to reflect in the share price has come. After crossing the level of Rs 100 we may see profit booking, which can bring down the share price to Rs 90-92.

Q: What are you thoughts on Marico and Dabur and which one would you like if at all?

A: Inspite of better numbers posted by FMCG twins, I don't think that share price is likely to move up because if one sees the pattern of investments made by larger investors, it was more as a hiding space for them. Now because of the secular run seen in other sectors like metal and banking, it makes logical for them to move from defensive to these sectors.

That is the reason we are seeing liquidations happening on delivery basis. There is no technical interest or trading interest in the FMCG sector at the higher level. So, this trend is likely to continue for the next couple of months unless we see corrections happening and other sectors catching on. I will be keep neutral view inspite of the satisfactory results.