The stock has corrected significantly. At the current market price it has priced in most of the negative factors, namely liquidity issues.
Another rate cut of 25 bps cannot be ruled out by RBI in the next six months. Our Diwali picks include a mix of large caps, midcaps and small caps from various sectors. We feel that this portfolio of these stocks will outperform the CNX 500 index in the coming year. We have identified HUL, Kotak Mahindra Bank, ICICI Bank, Asian Paints, HCL Tech, SBI Life, Dr Reddy's Labs, Aarti Industries, Mindtree, RITES, Dixon Tech and Lumax Industries in our Muhurat picks. Markets would also be watching for the Minutes of meeting for last RBI's MPC meet.
Ashok Leyland is the pick of the week. The stock has corrected significantly. At the current market price it has priced in most of the negative factors, namely liquidity issues. The sequential increase in vehicle sales due to discounts, festive season buying would start reflecting in prices as MoM demand picks up. Management is looking at every aspect to reduce cost. They estimate cost reduction of Rs 400-500 crore for FY20. Ashok Leyland can return 10-15 percent from current level, says Pankaj Bobade, Head of Fundamental Research, Axis Securities.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.