Here are a few stock ideas by Mayuresh Joshi

In an interview to CNBC-TV18's Latha Venkatesh, Sonia Shenoy and Anuj Singhal, Mayuresh Joshi of Angel Broking shared his reading and outlook on the market and also gave recommendations on various stocks.

Below is the verbatim transcript of the interview.

Sonia: Would you buy Axis Bank post the numbers yesterday?

A: It is sort of a mix bag. The kind of slippages that we expected, tad bit higher probably coming through from the non-watch list part and what the management has guided in terms of lower slippages and provisions coming through, I think it is going to be a very slow and gradual recovery for Axis Bank. Yes, from the watch-list that they had provided for in the past four quarters, a lot of stress from the corporate book has been taken away and with the kind of retail share exceeding 50 percent, that gives confidence on the net interest margins (NIMs) probably remaining stable going ahead as credit cost start tapering down. So remain positive on Axis Bank and I think the private banking space is what we prefer at this point in time.

Anuj: The other two stocks which have led these markets, ITC and Larsen and Toubro (L&T), what is your advise on that?

A: Remain positive on both the stocks. L&T more or less with the management commentary that we are expecting to double their business from a trillion rupees to two trillion over the next four-five years. The material and metal handling segment again because of the lower order book had a negative leverage on its segmental reporting and again the kind of asset sales that they are doing. So the Kattupalli Port sale which has happened, general insurance sale which has happened, they are probably looking at divesting the road assets as well which gives a turnaround of Rs 2,000 crore as well but has a bottomline loss of close to Rs 500-600 crore. If they are able to get down their working capital which they are slowly and steadily, that is a huge positive. With a good order book and good earnings trajectory, my own sense is L&T becomes a good bet on a macro recovery. My own sense is that within the largecap space, cement has largely outperformed. Ultratech is something that has given a good set of numbers in terms of volumes, so yes L&T is something that I continue to remain bullish about.

ITC of the cigarette part, with the kind of volume that one expects in terms of the price hikes that have been taken, that is given but I think that gets compensated with stable realisations coming through. My own sense is largely in line with expectations that the markets have and it should start contributing meaningfully over the next two years. So they are in FMCG, papers, agri, hotels, they should have a slow and steady earnings recovery as well.

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