Expect thrust on alternate energy in Budget 2015-16: Karvy

Solar energy in specific, if there is any subsidy considering that the manufacturing cost or the production cost is on the higher side that can be beneficial to the companies but having said that maybe a comprehensive national power related framework or structure maybe announced that may give emphasis to the power companies because beside any company which is entirely focusing on solar power even the traditional power companies may venture more aggressively into the solar power if government announce solar power related reforms.

Reema: There has been a lot of talk of-late about a thrust to housing especially affordable housing. Would you recommend playing housing theme for the next one or two years based on some impetus that it might receive in the Budget and if yes, via which stocks?

A: I feel housing will be one of the top items that will be seen this time. If somebody wants to play housing, I feel that instead of playing the real estate sector side of housing angle, I feel it makes more sense to buy the building products of housing angle.

When I say that things like ceramics and tiles and switch makers, plumbing companies – that kind of house building products kind of companies can be a fascinating area. It is just that all these stocks have rallied a lot – that’s a bit of a concern but maybe whenever there is a correction considering the overall government’s approach towards this, one can always look at Kajaria Ceramics, Havells and any of these names. So, instead of playing the real estate side of housing, I feel that home building side of housing makes lot more interesting bet.

Ekta: What do you think could come out on defence and which are the stocks you might accumulate pre Budget on defence?

A: I feel for whole concept of Make in India defence will be seen as one of the representative. In that sense a lot of focus will be laid there because recently Prime Minister said that why we should remain the largest importer of defence products; we should build on our own. So, in the largecaps probably Larsen and Toubro, Mahindra and Mahindra can be some of the names that we can look at and in the midcap name Astra Microwave Products can be an interesting bet. So overall the entire industry will get uplift even Bharat Forge can be an area. So only one thing we have to be little cautious is that all these have rallied a lot, so in that sense one can be patient in terms of tactical entry, some of these are very good opportunities.

Reema: Do you expect clarity on taxation on the e-commerce side of business and if yes, do you think that logistics companies could move up higher because they have already seen a significant run up?

A: E-commerce is a phenomenal theme, not just the way the whole consumption evolution is happening but also in terms of job opportunities. It has started becoming such a big job creator as an industry. Therefore, in that sense government may give some clarity on that because so much of global money is also vested there but having said that there is no direct e-commerce play in terms of companies, so logistics can be an alternative bet, so Gati and these companies have rallied a lot in that anticipation but I feel after the recent correction of Gati hereon towards Rs 220, this can be an area if somebody wants to make a tactical play to accumulate towards Rs 320-340 levels.

Disclosures: These stocks would have been advised to the client but as far as positions are concerned, I do not think there are any positions as such.