See Nifty 9000-9200 by Diwali; worst over for PSU banks: Baliga

So, at these levels, one should be a bit careful. Upside seems limited because the best is already priced in.Latha: What about the consumption stocks? Our technical experts were also pointing out to a lot of technical positives for some of the fast moving consumer goods (FMCG) stocks. What do you like in this space?A: FMCG, the next three or four quarters could be a bit difficult. One, because of Patanjali, the way they have grown. This year, it is expected to grow from 5,000 to 10,000, which is a 100 percent growth. The FMCG market, overall, is not going to grow at that pace. So, clearly it will be moving out from the existing FMCG players.The worst affected possibly could be Colgate. Hindustan Unilever also will see low digit volume growth. Overall, from a longer-term perspective, I would be more bullish on those herbal, ayurvedic companies like Dabur or Emami. They will gain over the longer-term. But over the next three or four quarters, there could be some pressure.Sonia: I wanted your thoughts on TVS Motor. It has done the best of the pact this time and it surprised with a double digit growth while the others are still at single digit growth this month. Is TVS Motors going to be the dark horse? Would you buy it now or would you still be a bit sceptical about the margin performance?A: I would be sceptical because we have seen extremely good performance in the last two years. The expectations are quite high. It will be difficult for TVS to keep meeting those expectations quarter-on-quarter (Q-o-Q). So, from a risk reward ratio, I surely will not favour TVS. I would prefer to go with the Hero or a Bajaj than a TVS at this point of time.Latha: The commercial vehicles (CVs) had a superb cycle. Now, there is a huge base as well. Do you think that Ashok Leyland has had it for now or would you still buy this stock on dips?A: We are seeing a consolidation and something like Ashok Leyland should be bought on dips. Whatever said and done, Indian economy story has just started and we have started seeing that in the macro numbers.So, from here on, the next 4-5 years you will really see a huge move in the Indian economy. The economy cannot move without light commercial vehicle (LCV) and heavy commercial vehicle (HCV) sales. That is the first one to take off.So this is just the beginning for Ashok Leyland. Any sort of dips to closer to levels of closer Rs 90-95 -- we had seen Rs 95-96 levels just after the results -- is a buying opportunity if you are talking of the next 2-3 years._PAGEBREAK_Latha: At this point in time, would you watch out for any stock in the Nifty, are all the stocks looking fully valued to you?A: We are in a long-term bull market but then at every level possibly we could stop, consolidate, correct a bit. Exactly what we saw happening to Nifty between 7,700 and 7,950. Those 2-3 weeks, we corrected, consolidated. Something similar now we will see when we see Nifty above 8,200-8,250.It could correct and consolidate in this range, maybe for a week or two weeks, slightly more. Overall, we are in an uptrend and we could see levels of 9,000-9,200 possibly by Diwali or maybe before that.So, from that point of view, you should be looking at buying some of the Nifty stocks. The PSU banking space is one where the worst is more or less over from a market point of view. We could possibly see some more write-offs in the next quarter, but then that will be taken in a stride.From here, on something like SBI, it is very much possible that you could get returns of around 30-40 percent if you are talking about the next 6-9 months.Sonia: What is your view on Titan because once again they have come out with a guidance saying that they maintain a revenue growth of 15 percent, but the fineprint of that release was quite cautious, both in the jewellery and the watches segment. What will you do here?A: Although there is no comparison with Jubilant Foodworks and Titan, both were first movers, enjoyed that first mover benefit for about 10-15 years. Now the competition has caught up for both of them.If you see a number of regional players, unknown players have become national players in the last 3-4 years. So, this is going to hurt Titan's margins to a large extent and which we have seen happening in the last 5-6 quarters.So, from that point of view, from here, the upside for Titan seems quite limited. It could just be a market performer, slight underperformer. So it does not make sense buying at this point of time.Sonia: How would you read into this news flow? It is still speculation at this point, but the question is why would Henkel not invest if they have an option? Because the business, the consumption story is just picking up.A: That is true. Looking at it, most probably Henkel would invest and that should be a positive trigger for Jyothy, which has underperformed in the last couple of months. So, that should be good news going ahead. So, on a correction, one should be looking at buying Jyothy.Latha: You would have gone through the entire gamut of midcap stock earnings. We have seen lately that the midcaps could catch up. The largecaps have already run up. In that space, what really stood out for you both in terms of earnings and as a valuation?A: Some of the stocks, which I had recommended in the past. For example, I like the PI Industries earnings. Grindwell also was decent and again, a bonus was actually something which cheered the markets.So, these two stocks which I have recommended in the past and I have liked the earnings, so I am continuing to recommend them.Sonia: What about some of these auto ancillary names, the likes of Pricol, Tube Investments, all these stocks are hitting new highs every day. Anything from that space that you like?A: No, most of these stocks have already run up quite a lot. From here on, I do not see as to much more of an upside.So, at this point of time, I would tend to ignore the auto ancillaries. As far as ancillaries are concerned, power ancillaries is one space where still there is decent upside despite the sort of a move, which we have seen because that is one space where most of them are having orders for possibly the next 15-18 months plus.Something like a KEC which I would still recommend, although I had recommended that at about Rs 99-100 levels and it has moved up about 30 percent from there, but there is much more of an upside and I still have a target of about Rs 170-180 to that stock.Sonia: The stock of the moment is Infosys. A record high on that one. Of course, it has been hitting new highs almost on a daily basis, but now it is inching towards a Rs 1,300 mark. Ahead of the July earnings, do you still see some buying action into Infosys expecting an encore this time?A: Yes, it is possible and that is the only stock which one should hold on to from a longer-term perspective in the IT space. Overall if you are talking on the IT space, I see decent amount of headwinds like in the next couple of quarters, but this is one stock which will continue outperforming.So, Infosys on any sort of dips is again a good buy.