Here are SP Tulsian's top trading picks

So, maybe this is purely due to the technical factors because institutions have continued to be take a very positive view on Bharti Airtel going forward because they think that from here on or whatever competition of Reliance Jio seems to have all been factored in. So, maybe short-covering and some renewed buying seen from the fund post Q4 numbers because the disappointment was only seen on the Indian telecom operations and nothing else.

Anuj: Thoughts on Kotak Mahindra Bank at Rs 928?

A: I continue to have the positive view on Kotak. If you recall last year when the banks were all ruling lower, I had two picks Yes Bank and Kotak, but having seen a good run up practically in all the banks now, the pecking order has been changed. In fact, we have been taking a bullish call on Yes Bank, Kotak and RBL Bank. But RBL Bank having risen very high and I think that now, maybe in the pecking order, probably it will go with Yes Bank followed by Kotak bank, but continue to have a very positive view on the Kotak Bank with a medium term perspective.

Anuj: You track Himadri Speciality Chemicals, if I am not wrong and you had recommended this stock earlier. Rs 30 crore net profit versus Rs 6.7 crore. Any thoughts on this stock now at current levels?

A: In fact, we have recommended this stock, I remember exactly maybe 8-10 months back at Rs 17 and it is a classic case of turnaround at that time also we have said that they are the leading makers of coal tar and that is used in the aluminium industry. They had some problems with their China unit a couple of years back but they have really carried out the whole cleaning process in FY16 and when they came out with their FY16 Q4 numbers, at that time the hint was received that probably this is the take off stage for the company and since then every quarter, the company has been improving their performance.

But yes, as I said stock has already quadrupled from Rs 17 to almost Rs 67-65 now. So naturally one has to take a pause, but these numbers which the company has posted are really excellent numbers. And the company's product continues to enjoy a very good patronage because of the huge growth seen in the aluminium industry in India.

Surabhi: Just going back to the point on capital goods, ABB India and Siemens, both of those stocks hitting their 52-week highs. The dream run for these stocks. And Ashwani was just saying that the momentum could take them another 10-15 percent higher. Do you agree with that? If you were to buy into capital goods now, what stock would you pick?

A: Actually transmission and distribution (T&D) is a very good space. Maybe in fact, I will not put capital goods, that is turbine, boiler and generator in the same space because in that event you have to include Bharat Heavy Electricals (BHEL) also in that account. But, the more of the switchgear and transformer kind of things and if I need to take a call of 52-week high on ABB and Siemens, you have to add the name of GE T&D India also. It is a GE company making purely into the T&D space and in fact, I have been keeping my extremely positive view on all these stocks because if you take ball park for all these three companies that is GE T&D, ABB and Siemens, they have always been ruling at a price-earnings ratio (P/E) multiple of closer to 60-75.

In fact, maybe ABB at one point of time have been ruling at a level of 100 P/E multiple also. But if I take a call from here on because I am keeping extremely positive view on GE T&D, from here on, if you take the situation, the company is posting or have come on a very constant growth trajectory with a topline seen of about Rs 5,000 crore and continuously posting an earnings per share (EPS) of closer to about Rs 2, the face value if Rs 2 every quarter. So, actually what has happened with GE T&D that is the first quarter of FY17, they have provided Rs 255 crore as exceptional towards the bad debts, towards the direct tax liability, indirect tax liability and that is why market is seeing that in nine months, they are seeing a loss of Rs 130 crore which is in fact misnomer.

Going forward, I will not be surprised to see an EPS of closer to about Rs 11-12 coming in from GE T&D. As I said, if I apply a P/E multiple of 50 also, I will not be surprised to see a price of Rs 550-560 and now the stock is ruling somewhere at Rs 360-370.

Coming similarly on Siemens and ABB also because they are not purely into the T&D space, but the switchgear and other electrical kind of accessories which they are providing and you can add CG Power amongst the domestic space also. So, these four stocks are really looking very good and I have been giving positive call on all these stocks for quite some time.

Surabhi: Your thoughts on what has been a phenomenal day for the bulls. Does this market still give you the comfort to buy fresh?

A: We always had comfort even when the market was falling during the demonetisation time and if you see the call now, I would say that in fact the fresh trigger for our markets to really move up for next three months is the normal monsoon prediction which in fact, I have said a fortnight back that probably the El Nino effect which is seen back ended probably will get pushed into and this time, we will be seeing the onset of the monsoon also a bit early.

So, taking these into account, I do not think that there is any kind of looking back because you do not have any kind of hiccups seen on the political front. I am not very sure on the global or the geopolitical situation, but if you confine only purely on the Indian economy, I think you have a long way to go and you have to keep counting these figures, 9,400, 9,500, 9,600 and I do not know, maybe the counting can go till 9,800 or 9,900 in this calendar year.

Surabhi: Between Eicher, of course, Hero Motocorp will report numbers today, not expecting a great quarter from Hero, how are you looking at two-wheelers given that monsoon is a theme and overall everybody is going to be talking about that part of the story as well, rural story as well?

A: Two things. First on Hero, we have to give a pass to the Q4 numbers because we all know that because of the heavy discount having offered on BS-III inventory to get cleared on last two days or the quarter the discount of Rs 12,000 offered, obviously that will be seen get reflected into the Q4 numbers of Hero Moto. But if you just overlook those things, there is huge demand going to be seen for two-wheeler because of the robust monsoon, we are going to see, because of the good rural spending. So, I am keeping positive stance on Hero Moto.

Coming specifically Eicher Motors, because if you see this 60,000 vehicles sales number for Royal Enfield, it seems to have got stagnated there probably because of the capacity constraint and if you see the competition coming in from Bajaj Auto in that space. And I do not think that Eicher Motor is really having any kind of cheer from their commercial vehicles segment. So, Eicher Motor now ruling at its life-time high, I will probably be cautious and I will not hesitate in booking profits in Eicher Motors if I am invested and moving to Hero Moto at the current level if the disappointing numbers gives me a dip of about 3-4 percent on the current price.

Anuj: A word on Ujjivan Financial Services and also on Equitas Holdings. Do you think both these stocks have now absorbed all the bad news?

A: If I first come on Equitas, probably what market has liked after the numbers having seen from the company shifting from microfinance book because if you see, there has been degrowth in the microfinance and now, of the total business, of the total assets under management (AUM) about 46 percent constitutes to the microfinance, so that seems to be a logical shift having taken on part of the company, they are moving into the vehicle finance, housing finance, loan against property and all three components are also forming closer to about 45-46 percent. So probably market has liked this shift that the concentration on the microfinance business which is now seen having headwinds will not be seen going forward for the Equitas.

But coming specifically on Ujjivan, definitely Q4 was a disappointment and more specially when the management has clarified that Q3 provisioning will get recovered in Q4, that has not happened. But I am keeping the positive view going from here on because kind of beating which we have seen in Ujjivan and with the normal monsoon prediction seen, the recovery will also accelerate for the company going forward and I do not think that much downside is seen from here, so positive stance on both stocks, Ujjivan and Equitas going forward.