Pick MindTree, NIIT: Sanju Verma

Sanju Verma, Group CEO at Violet Arch Capital Advisors told CNBC-TV18, "If you are looking in defensives and if somebody who was going to be totally underweight on cyclicals in 2013, I would have missed out on the brilliant rally in JSW Steel. As recently as August 2013 this stock was at about Rs 450 or Rs 460 and it is trading at Rs 1,000 levels today, that is a stupendous rise for a cyclical ferrous stock despite the fact that internationally steel prices have done precious little."

"Within defensives it is very unfair to club all defensives and bunch them together without being more discerning and more discreet. In the last 2 months FMCG as a space has not really done much, it has flattered to deceive, while the traditional old guard comprising a Hindustan Unilever (HUL) and ITC will always find takers from the large hedge funds, pension funds and endowment funds because of the sheer weightage that they enjoy in the broader MSCI benchmarks which most of these large pension funds follow," she added.

"The point is for somebody who is not following benchmarks but is looking at absolute returns, because absolute returns do matter to you and me, it is relative returns which matter to a fund manager, but not necessarily to the common man on the street. So I think FMCG as I said has disappointed but within defensives look at IT. The S&P, BSE Sensex for calendar year 2013 has gone up by just 8 percent precisely speaking whereas IT as a pack has gone up by 58 percent, the outperformance has been by a huge margin and howl and IT outperformance has not been led by the usual suspects, be it a Tata Consultancy Services (TCS) which went up by 67 percent or even an Infosys."

"MindTree led from the forefront with respect to the outperformance moving up by 129 percent this year. This stock was trading at less than Rs 300 in calendar year 2011 and is trading at more than Rs 1,500; that is where its all-time high was, at about Rs 1,540 levels or thereabouts. Now the point is should you go the whole hog and still buy a MindTree, the answer to that would be, you have to be very cautious because stocks have run up and run up very fast. But if I have to give the pecking order for midcaps, for me at this point in time the top two midcap ideas would be MindTree, NIIT and perhaps a little bit of Tech Mahindra too, that has been an old favourite," Verma said.