Here are Deven Choksey's top trading ideas

In an interview to CNBC-TV18, Deven Choksey of KRChoksey Investment Managers shared his reading and outlook on the market.Below is the verbatim transcript of Deven Choksey's interview to Latha Venkatesh, Sonia Shenoy and Anuj Singhal on CNBC-TV18.Anuj: Is there panic among clients or are you seeing more orders?A: Certainly there is reluctance among the people who have been trading in the market. They are probably most reluctant to bring new money but on the other side, the portfolio money is coming into the markets in this fall on selective ideas. So certainly we are seeing both sides of experiences. On the brokerage desk, trading clients are having less of activities but on the front management side, the activity is almost normal if I have to put it across.Overall, as we see and gather the feedback from most of the companies, gradually they are seeing -- at least in this week they have confirmed that at the retail level -- a better footfall compared to the earlier weeks. That probably is improving gradually. So certainly situations on the ground for the corporate sector -- though not completely improved but is improving -- and the take is that by December 15 or so, the situation should turn out to be close to normal if not fully normal.Latha: You would think the market has put a bottom at 7,900 or would you say you don’t give a damn about the Nifty, you are buying now?A: One area which is not giving the comfort -- to conclude that, it is a bottoming out process and that is currency. The rupee -- if it is halting at 69.25 a dollar kind of levels then possibly I would like to believe that the market would have turned up and probably made a bottom.I would not know whether 6,925 holds or it will probably go beyond that. As of now, what we are observing is that because of this fall in the rupee value, in some of the companies' cases we are going to see a mark-to-market impact in this particular quarter and that could further bring some nervousness at least in those counters. They are not mainline index counters at this point of time in our study. I believe that some of the cash market companies -- the B group or the mid-sized companies are basically mostly having the mark-to-market provisioning coming up at least in the first part of the study that is getting reflected. So that could have some amount of pain because of the fall in the rupee value and because of the fall in the rupee value, the relentless selling by the ETF is also continuing. So these are some of the pinpoints, which is preventing me to say that we have made complete bottom but I would like to believe that yes, in the month of December we should be seeing some amount of bottoming process and the recovery started to happening somewhere in the first week of December or maybe second week of December.Sonia: What are your thoughts on Zee Entertainment? That stock has lost about 15 percent this month and yesterday we heard from players in the fast moving consumer goods (FMCG) space like Dabur that they will be slashing their ad expenses by almost 50 percent because of the demonetisation impact, do you think this could affect Zee Entertainment in the medium-term or would this be a good buying opportunity?A: Certainly, some amount of pains are going to be seen because their advertisers are going to withdraw at least for the time being till the time they see the situation becoming normal. That could have its impact onto the revenue book plus also not forget one more thing that most of these companies including Zee, valuationwise are richly valued. They are not available at an attractive valuation either. So from that perspective, some correction, moderation in the price is definitely seen. How much further fall it could have -- maybe you would probably look at it into more detail once we get little more clarity about how much the revenue impact would come in their books but as of now we believe that yes, expensive valuations are probably the ones where some amount of moderation or correction would take place at least in the near future.Latha: What would you buy then?A: Few opportunities, which are looking more interesting. Companies which are not having direct consumer facing, ones which are in the industrial segments, we have been liking some of the companies into the transmission and distribution space where the capital goods players are the big time gainers because of the higher amount of investment taking place in that space. So some of the companies which I may have mentioned even earlier which we continue to like are companies like GE T&D, Schneider Electric or ABB Cements kind of companies, which is likely to have -- next two-three years of big visibility for the business that they are into. So this is one space we continue to like.We have been liking the agricultural space particularly because of higher amount of disposable surplus in the rural market particularly with the good monsoon.Sonia: You were discussing Zee Entertainment earlier, wanted your thoughts also on some of the auto names because now by the end of this month names like Maruti will be down 20 percent, Tata Motors as well down about 15-16 percent, is this a good time to be buying any stocks?A: This particular fall is giving an opportunity -- a significant amount of correction in the valuations have taken place for companies like Maruti. Tata Motors also has almost corrected 15-20 percent so certainly this is one more company, which would look interesting. Even Bajaj Auto looks interesting.My own take is that, these companies are down temporarily for the reasons. I would think that even if one has to accept that the month of October which has gone good for most of them, November may remain a weaker month and December will be an average month. Even for the auto companies, month of December generally -- due to model change issue -- is not a great month anyway. So from the part of view, if you look at it, I don’t think that one should be too disappointed with the performance of many of the auto companies. Certainly, some amount of fall but not great thing to worry about.That is where we believe that corrected valuation is giving an opportunity into auto companies including some of the good auto ancillary companies, which have corrected by 15-20 percent, they are also looking interestingly positioned in this market.Latha: You were telling us about the stocks and sectors that you would like. Would you like to pick up any of the auto stocks?A: We have been liking Bajaj Auto and I believe that the company looks reasonably okay. Even the new model launches that they are having and the kind of potential that they are talking about, I would think that Bajaj Auto could be relatively a safe bet particularly because it has almost corrected Rs 600 from the highs. So that is one company which looks relatively more interesting at this point of time.Even Maruti looks interesting in the correction. For some reason if the stock corrects further, in the month of December for whatever reasons, it would be further buy opportunity in case of Maruti as well. I believe that some of the auto ancillary companies -- the likes of Wabco, which have been quoting at a premium valuation earlier have come down and are quoting at a reasonable valuation. They are looking interesting from the investment prospect. So certainly, the opportunities are seen in different counters and one will have to select them based on the available valuation at the current price and probably at the discounted valuation if they are available in future one should be ready to buy.Latha: How are you approaching the financial space, non-banks, private banks, public sector undertaking (PSU) banks?A: On one side, in the PSU banks particularly we are likely to see positive impact because of the portfolio and that should have relatively better bottomline coming up in subsequent quarters as well.On the other side, some of the loans which have remained outstanding has probably started meeting the kind of a clearance as far as the payment is concerned to the bank. So somewhere some of the accounts have started performing for the banks. At least this particular pressure is also going to go away.How the current account savings account (CASA) deposits advantage would come to them -- not very sure at this point of time but we believe that it could ease out the situation for the banks in general. So given the valuation at which some of the frontline PSU banks are quoting at, I would think that they would remain relatively more attractive at this point of time, may give relatively better performance as far as the stock price is concerned.Some of the corporate banks in the private sector, they are also looking relatively more comfortable now with the corrected valuations including some of the NBFCs where also the valuations have corrected. So yes, you would have a choice now to buy them which were up till now quoting at premium valuations, now they are corrected. So it could be little bit more comfort level to buy them into the portfolio.