Bajaj Electricals, Inox Wind top picks: Mayuresh Joshi

Mayuresh Joshi of Angel Broking told CNBC-TV18, "We like Bajaj Electricals in the midcap space. The company did post a good set of numbers specifically on the engineering and projects (ENP) side of the business which was a laggard for the company. Turnaround would be quite evident in the next two years. So, the EBIT losses specifically on the ENP side of Rs 87 crore that Bajaj Electricals had posted for FY15, our take is that FY17 should turn into earnings before interest and taxes (EBIT) profits of close to Rs 96 crore odd. The EBIT margins have surprisingly held up well for the ENP segment at 5.8 percent for this quarter.""Our take is that with all that three segments contributing meaningfully over the next few quarters, including consumer durables which has a quite a tepid show in this quarter and the lighting Lumina segment which has a lot of thrust in the government processes and reforms. The combination of these businesses should ensure that the topline grows in excess of 12 percent on a compound annual growth rate (CAGR) basis.""Our take is that Bajaj Electricals should post decent profits in FY17 anywhere between Rs 120-122 crore odd. So it remains one of our top picks," he said. "The other stock that we will probably like is Inox Wind. It is one story which again I think has a lot of government emphasis, 60,000 megawatts of renewable projects being talked about and clearly in terms of the topline growth, Q1 was exceptional with the kind of order that it has got. The kind of sites under acquisition gives a very healthy view in relative terms of revenue to come. Topline growth in our opinion is expected to grow at a CAGR of 48-49 percent over the next couple of years. No royalty payments from FY16 and the rotor plates that we are talking about, the diameter size is expected to increase from 93 m to 100 m which would improve realisations as well.""They are increasing their capacity in Madhya Pradesh which will also enhance in terms of execution of their order book. Valuations are also not expensive and you can expect margins to land anywhere between 17 -18.50 percent over the next couple of years. Valuations are not looking expensive at this juncture and earnings should improve. So, Inox Wind also remains one of our top picks," he added.