Cummins India remains top pick for 2012, says Dilip Bhat, Joint MD, Prabhudas Lilladher.
Bhat told CNBC-TV18, "I would bet something like Cummins India at the moment because that is a stock which has really taken a good amount of beating. I think that the way their basket is and the way that they are catering to the Indian sectors it is very well diversified and 25% of their turnover comes from the exports, so the rupee depreciation is helping them. But more important i think the plans of parent USA which wants to outsource more from the Indian company, so I think from this fall. maybe after the quarterly results I would still think that Cummins India is a stock that one should definitely look at it because every other which way, whether it is generating free cash, RoE the company still seems to be on a very sold footing."
He further added, "From the current level if RIL has to come down, I think further fall in the gas production itself should be a lethal blow for them. Bit otherwise if you have to take the petrochemicals or the refining margins. I don't think that they would really contribute so much to the weakness of the results, so I think it has to be decided by what is the outlook of gas which will really decide fortunes of Reliance."
