Like private banks, selective pharma, TCS, Infosys: Angel

Mayuresh Joshi of Angel Broking told CNBC-TV18, "The uncertainty would still linger on at least for the next few weeks to say the least and what FOMC does and what Reserve Bank of India (RBI) does in terms of the quantum of rate cuts will be the key monitorable. Having said that, we feel that private sector banks on declines are a very good opportunity. The kind of earnings growth that they can exhibit over the next few quarters can be quite stupendous. Looking at all the key parameters that one looks at from the banking perspective whether that be related to asset quality, capital adequacy or whether that be related to their branch network, fee income and non-fee income, I think all these parameters are surpassed by the private guys. So, clearly private sector is something we like, the top tier IT companies is something we continue to like." "Our own take is that the kind of client mining that a lot of these top tier names have done, that will lead to significant amount of increase in revenues both in dollar and rupee terms. Though the rupee depreciation acts as a tailwind, a lot of the companies including Infosys have got headroom in terms of utilisation rates going up, close to 300 bps in our opinion. Even in the case of Tata Consultancy Services (TCS) the kind of digital foray, the kind of mining that it is doing is going to aid the company going forward. So, TCS, Infosys and HCL Technologies are something that we continue to like and also, selective pharmaceutical names," he said. "Though valuations for the pharmaceutical sector generally are a little bit stretched, selective names like Sun Pharmaceutical Industries is where we believe a lot in terms of how the Ranbaxy implications will go through has come through in the price. The volume growth can be quite stupendous FY'17 onwards and similarly in the case of Aurobindo Pharma. The key approvals that the company has received, the injectables business, the antiretroviral (ARV) portion that Aurobindo Pharma caters to, our own take is that a topline growth of 12-13 percent over the next two years is not ruled out," he added.Disclosure: Analyst does not have any personal holdings but might have discussed all these stocks with his clients.