Look at Balkrishna Industries, says Dipen Sheth

Dipen Sheth of HDFC Securities told CNBC-TV18, "Balkrishna Industries is a tyre manufacturer with almost all its production being exported out of the country and with a very strong footprint in Europe and the US in off-the-road tyres whether for agricultural implements or for heavy earth moving equipments. This is one company which has assiduously grown volumes in its business for a decade in the mid-teens or late-teens and just compounded year-after-year. To us, this looks like a classic compounder and right now they have gone from 160 to about 3 lakh tonnes capacity, they are just coming off a huge capex cycle and they are about 55 percent capacity utilisation."

"They are gaining market share in all the markets they are selling into and one large market they are selling into Europe is facing currency headwinds. So they will report lower earnings in FY17 versus FY16; for FY16 they are very intelligently hedged. So again for people who want to look at FY17 numbers and buy them then no, so we have taken the trouble of looking at FY18 numbers for these guys, in terms of what might play out with higher volumes and even the lower euro and to us there is a compelling case of buying into this stock," he added.

"On the other hand in SML Isuzu, this is more of a concept investment right now because they have a very interesting franchise in school buses and their truck business has borne the brunt of the downturn in the commercial vehicles. So this used to be the old Swaraj Mazda and now it is part owned by Sumitomo and Isuzu has a stake in this company. What we are betting on is that Isuzu will notice that this is a great franchise to build out their business in India and will sooner or later pick up a stake and there could be tremendous upsides if that were to work out," he said.