India market which has given over 17 percent return so far in the year 2017 has no dearth of themes which could produce multibaggers in the next 2-5 years, says Ace stocks picker, smallcap Porinju Veliyath, of Equity Intelligence India in an exclusive interview with CNBC-TV18.
“Although it is not going to be an easy ride for global economy going forward, the whole country is a theme today. Indian markets are very reasonable going by the valuations,” said Veliyath.
“There is no place in the world like India for picking stocks. At least there are 100 brands amongst the listed companies which are poised to create wealth in the next 2-3 years,” he said.
We are near $2 trillion market cap which has grown by $50 billion in the last one year. Indian economy is changing dramatically and structurally which makes India as a stock picker’s paradise.
The man whose biggest multibagger Prime Minister Narendra Modi and expects USD 40-50 billion of money coming into domestic markets said that India cannot afford to continue the culture of waiving loans.
“Yes, it is bad for the Indian economy, but it can help revive rural consumption a bit. Things will look better from that perspective, but culturally, we need to keep strict discipline at this point in time,” said Porinju.
We are at an inflexion point in terms of economy growth and strict discipline should be maintained so that a culture of financial indiscipline is not encouraged.
In terms of themes to bet on, Porinju said that investors should focus on brands which have created huge wealth for investors’ in the past and has the potential to deliver in the future.
“There are 100 of brands which are struggling for various reasons such as promoters failed to manage the company which led to underperformance. Among the listed space, I see 100-150 companies which are poised to create wealth in the next 2-3-5 years’ time,” he said.
There are a lot of brands which have done really well include names like Titan Company, MOSL, Asian Paints, Bata India, IIFL, Venky’s, TTK Prestige etc. among others.
We have accumulated Balaji Telefilms in the past few months because the way they are managing the new business – chances of outperformance is very high, said Porinju.
The struggling brand such as Kaya, Saregama India, Shalimar Paints, Archies, Gati, Kohinoor Foods, Emkay, UFO Movies, BPL etc. among others is worth looking at.
Commenting on the Tata Group stocks, Porinju said that Tata Global Beverages and Tata Coffee did not perform very well in the recent past but have potential to outperform because they have a very important role to play in the Indian economy.
“If the consolidate, restructure and if Tata’s decide to create wealth in these companies, I am telling you these stocks will be 5-baggers in the next 5 years,” he said.
Commenting on media stocks, Porinju said apart from Balaji Telefilms, ZEE Media could be other stocks which could give multibagger returns in the next 3-4 years’ time.