Look at Thomas Cook, says Prakash Diwan

Prakash Diwan of Altamount Capital told CNBC-TV18, "Consumer discretionary is likely to go up in the first leg of any kind of an upmove that we see in the economy. Thomas Cook has had a couple of acquisitions, very large acquisitions and unrelated. So the balance sheet even with a bigger size has been profitable enough. The operating leverage is very clearly on the anvil. They have guided 50-60 percent growth in domestic travel itself is what they are looking at. So, there is a huge change that is happening within their business model. For the first time some of the subsidiaries have started making money. We never heard Sterling Holiday Resorts making money. So they have been successful in making these companies run more efficiently."

"Quess is their staffing business which is unrelated but they are trying to acquire a couple of other businesses with cash management services. The fact is that they have a very able management, they have a brand which is so powerful – if Thomas Cook were to dispense money out of third party ATMs, people are going to find it very reliable as compared to somebody who is unknown. So, those are the businesses that they will get into," he said.

"Essentially they are now factoring in, they have integrated themselves very well with all players in that space. So they are not left out of the space and it is not B2B kind of thing which has the airlines and the hotels directly doing the ecommerce business. Even intermediaries like Thomas Cook have started playing role because they hold a bulk of inventory; they hold a bulk of client segments."

"The spend on travel is urban centric in India has not yet gone to tier-II and tier-III towns. Thomas Cook is very active in these markets so it is taken in all the moolah from that. My sense is once the ‘Make in India’ campaign starts translating into some business travel, especially business related travel will add on to this. Right now it is just domestic that they are thriving on. However, both Cox & Kings and Thomas Cook have a great story. Cox and Kings has a slightly different model though," he added.