Prefer M&M Financial, says Mehraboon Irani

Prefer M&M Financial, says Mehraboon Irani, Nirmal Bang Securities.
Irani told CNBC-TV18, "I think market always tends to overreact as and when there is some newsflow. Market was expecting banking licenses or banking amendment act to be ultimately passed in parliament and the Rajya  Sabha (RS) which has happened. I think should one buying to it right now from a longer term – honestly no objection despite the fact that they could be ruling expensive. Over the prime candidates, I would put Mahindra Financial Services, Shriram Transport and L&T Holdings."

He further added, "Now whether one should be buying into the stocks right now, I think the market has largely discounted the fact. Also one needs to argue also accept the fact that one is not going to come in a hurry for this company which ultimately get a banking license. The path ahead is going to be a little bit thorny and going to be a little bit long. Whether licenses will come immediately, how long will it take them for setting up the branches, the branch network has to be there, 25 percent of the branches have to be in unmapped areas, there should be priority sector lending of 25 percent."
"It is not all that profitable especially if you look at the way some of the better, well-managed private sector banks like Yes Bank took its own time to find its path. So I think the path ahead as I mentioned is long. I think these three companies are prime candidates and possibly I would wait for some decline to come in the overall market if it comes over the next few days or these stocks too either way falter by around 3-5 percent from here before one could look into it. My best bet would be Mahindra & Mahindra Financial Services as a stock followed by L&T Finance Holdings and third would be Shriram Transport Finance in these three listed entities."