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The market maintained its northward journey and hit fresh record high on the Nifty on Thursday for the first time since January 29, 2018. The Sensex also crossed 37,000-mark.
The rally has entirely been driven by domestic flow. The market climbed all wall of worries like volatility in crude oil prices and rupee, monsoon uncertainty and trade war concerns.
"It is difficult to predict about short term but for the long term, India is clearly the best economy among emerging markets at global level," Dipen Sheth of HDFC Securities said in an interview to CNBC-TV18.
So investors are not going to run away from India, even if government changes, he feels. "For long-term investors, India is going to be the best place to be in at least for next five years."
He said the reality is among Nifty, 10 stocks delivered 10 percent kind of returns, while 20 stocks fell more than 10 percent.
In the midcap space or broader space, he mentioned couple of weeks ago and maintained his views that one has to be choosy and look for quality stocks.
"Companies which have high quality and durable business always buy in the trouble. For example, Jubilant Foodworks franchise, which faced big trouble 1.5-year ago. Look at the first quarter FY19 results, which showed that all troubles are behind," he said.
Consumption
He would be selective in the consumption space that has long way to go. "Look at Jubilant Foodworks, after taking over by new Chief Executive Officer Pratik Pota, he focused on the same thing product and delivery and look at results now. He is brilliant CEO."
Air Conditioner and Air Coolers
Symphony reported 40 percent fall YoY in revenue on standalone basis but he is still bullish on the stock.
Air conditioner and air coolers are not even half penetrated market in India. So he remains positive on the stock but that does not mean he is negative on Voltas.
Sheth said the company has been going through some trouble due to likely increase in truck load capacity but nothing wrong with the management and structure of the company.
He believes Rajiv Bajaj of Bajaj Auto is very clear on his targets after listening to his speech while addressing shareholders in the Annual General Meeting last week.
"Its core return ratios are far better than FMCG companies. It has strong product mix, sales mix and has seen fantastic revival in three-wheeler space. So for the Bajaj, margin going from 19.5 to 17.5 for a quarter or two does not matter."
He said Havells is beautifully managed business and now with buying Lloyd company entered into air conditioner business also, the underpenetrated category. Lloyd reported 40 percent growth on like-to-like basis.
Havells' return ratios are at around 40 percent, so Sheth sees growth for next 10 years in the company as it is the leader in every segment which they are in.
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