GEPL Capital picks 7 stocks to light up your Diwali

GEPL Capital has come out with its report on Diwali picks.

Diwali Picks 2011: It been a tough year for the Indian markets with a 19.5% correction in Samvat 2067, and volumes declining by 40% as the FII outflow for the period stood at Rs (-30) bn. All of this has lead to our markets trading at trough levels of 13x 1 yr fwd earnings, a discount of 10% to its past 15 year average.

A series of changes across the globe and in India have led to a fear for investment in equities and led to a scenario of uncertainty, volatility and currency depreciation. The higher commodity prices driven by QE2, the Middle East crisis and the pressure on financials with the debt concerns surrounding European banks have trickled down to our economy leading to a slower growth rate and higher inflation. What seems like an over ambitious deficit target, slow execution in India and political instability due to the recent exposure of scams, we have become more vulnerable to negative news flows.

However, with the current fear in the market, there lies a ray of hope, with plenty of stocks with good business ethics, practices and performances being able for a comparatively cheaper valuation. We have carefully picked up a few stocks, which we feel confident about & expected them to give good returns over a longer term. These stocks are our fundamental picks based on structural opportunities or business cycle reversals. The idea has been to pick stocks with low risk and above average return potential. With that we would like to wish you, A very

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