Bet on L&T Finance, M&M Financial for long term: Irani

Irani told CNBC-TV18, “I feel L&T Finance Holdings and Mahindra & Mahindra Financial Services should be looked at positively. The stocks have already gone up. In fact, in terms of valuations, L&T Finance is perfectly valued. So should one go and buy it? If one is a long-term investor then there is not much of a problem, but one needs to understand that the banking licenses are not going to come in a hurry.”

He further said, “I think it is going to be 2015 by the time, the companies are going to be able to transform themselves into a bank or set up a bank. I don’t think it is going to reflect anywhere in the P&L account or balance sheet of the companies in the near future.”

“I like L&T Finance. I hold it because there were clear cut exposures or excess to the long investor. They have the experience of handling projects with long gestation, they have a great brand and I think they would ultimately be a good player in the financial services segment. So because of all these reasons, I think L&T Finance stands out along with M&M Financial which could be having one of the better managements in this particular sector,” Irani added.

“So is it a good bet to buy these two in a hurry for the shorter term? No, but if people are long-term investors, they already own the stocks or want to own these stocks for future consideration that they would possibly become banks. I think these two are ideal candidates and should get the nod. They could turn out to be good long-term investment bets.”