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Apr 24, 2012, 06.35 PM IST
Sandeep Singal, Co-Head Institution Equities, Emkay advice traders to prefer L&T over BHEL in capital space.
Singal told CNBC-TV18, “We are underweight on capital good sector per se and BHEL in particular. Within BHEL and L&T we would prefer L&T over BHEL.”
He further added, “Why we are underweight on capital goods is typically because if you see the gap between investments and savings rate that is widened and savings rate have gone substantially down and there is no concrete effort on the policy front to increase this. This really needs to get equilibrium so either the savings rate should improve or investment go down because India we don’t have too much of an external capital inflow that we depend on our capital expenditure on those external sectors and there also by decreasing the interest rate typically we have given a negative signal to the external sector in terms of inflow of capital. So overall all in all the kind of power sector situation is the incremental order book of BHEL would definitely be strained and we doubt that this stock would give you outperformance in absolute return so negative on the stock."
May 20 2013, 23:30
- in World News
May 20 2013, 12:21
- in Commodities