Blue Ocean Strategic Advisors' Ashish Maheshwari shares insight on top stocks to watch for in trade today. #BQLive #BQStocks
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00:00 Thank you, Pramav.
00:01 Very good morning to all the viewers.
00:02 I am Heeral Dhadia.
00:03 Clearly, if you go to see in terms of where markets are concerned, the Somba trade does
00:08 continue but we are hovering pretty much at those 19,400 levels.
00:13 With regards to Bank Nifty as well, we have tried to maintain above those 45,000 levels
00:18 but clearly, the breath is skewed towards the advances in today's session as well and
00:23 that is giving you some bit of strength overall.
00:26 But clearly, towards expiry, that wobbliness is expected to continue as well because clearly,
00:32 Nifty has been stuck between its 20 to 50 EMA and clearly, it's the financial Nifty
00:38 expiry that will be in focus from here on as well.
00:41 Overall, there has been no return from Nifty since the 5th of July as it remains stuck
00:47 post the initial moves that it saw as well.
00:50 Clearly, now the earning season is also behind us.
00:53 At the same time, there is no major economic data that is lined up in the near term and
00:58 that is the reason why we are going to see some bit of consolidation and Nifty remain
01:03 in that broad range as well.
01:05 Clearly, analysts have been talking about 19,200 to 19,700 kind of a range that Nifty
01:10 could hover around so far.
01:12 Moving on sectorally, metals and IT emerged as the top gainers while media as well as
01:17 the PSU emerged as the top losers.
01:19 In today's session as well, if we talk about a few of the names, HDFC Life Insurance Companies,
01:25 SBI Life, New Insurance, all of these are seeing some smart moves in today's session
01:29 and you have a Geo Financial Services that is locked in lower circuit for a second consecutive
01:34 session.
01:35 Joining us on the show to discuss stock specific action today is Ashish Maheshwari, Director
01:39 of Blue Ocean Strategic Advisors.
01:41 Ashish, good morning and welcome to the show.
01:44 Good morning to you also.
01:47 Ashish, let's start with the Geo Financial Services.
01:52 Second consecutive session after listing that the stock is locked in lower circuit.
01:57 What's your view overall, you know clearly, because it seems and overall there are more
02:03 sellers as compared to buyers on the street in the last two sessions as well.
02:08 What is it that you're picking up?
02:10 Is it because it's capital without business and it cannot command such a high premium?
02:17 And there is a rush to exit the stock, which is actually suggesting that there is limited
02:22 scope in store in the short term and it will only give returns over the long term.
02:27 So, it is probably an investment from a really long-term perspective.
02:31 And from what price levels do you think that the buying could actually emerge on a counter
02:35 like this?
02:38 You have mentioned so many points and they are all relevant points as far as Geo Financial
02:44 Services is concerned.
02:45 I'll also brief a few new points also.
02:49 One is that as it's not going to remain part of FD and BSE 30 prices.
02:57 So some sailing is coming from those funds, which are the basic funds.
03:02 And I'm expecting in between yesterday and the next few days, approximately 14-15 crore
03:10 shares will be sold by Geo Financial Services.
03:14 So this is one trigger.
03:15 Second, if you see approximately 10 crore shares are still in the sale window, then
03:21 there is no buyer for this stock.
03:23 So it shows that everybody just wants to come out of the stock.
03:28 And people have bought this Reliance Industries share in anticipation that this will be listed
03:33 somewhere between 350 to 375 also.
03:37 But as the stock has not moved at those levels.
03:41 So we are witnessing some sell off in the stock.
03:45 I'm expecting this will drift below 200 rupees because fundamentally also typically they
03:53 own 6% of Reliance.
03:54 This is the reason they are having so much net worth at that particular price point.
04:00 But business wise, it will take time to build that business.
04:04 And this is the reason we are witnessing a lot of sailing coming in the counter and will
04:08 continue in fact.
04:10 So I'm expecting the stock will go below 200.
04:12 At that price point, maybe I'll surely look at it for a longer term.
04:19 But not above 200 for sure.
04:23 So my next question coming to you is, we know there are no buyers in terms of JFS.
04:28 However, someone who's already been a beneficiary in terms of the 1 is to 1 on the demerger
04:36 and is holding a JFS, would you advise them to sell at current levels or stay invested?
04:42 There's a reason Stampede is there in this stock, that those who are holding this stock
04:49 and they've got it at free of cost.
04:52 And there's a reason they are selling this stock at booking gates.
04:56 So in my view, this momentum will continue because there's not too much appetite in the
05:01 market to buy this for a longer run because there's so many other stocks which are available
05:06 at much lower market cap than Geo Financial Services.
05:09 Geo Financial Services is a really long term story because they have to build this business
05:15 from scratch and it will take time because it's quite competitive market.
05:18 They have to compete with the HDFCs and Bajaj of the world where they are representing all
05:24 the token corner of the country now.
05:26 So it's not that they will pass through easily, though they are having all that structure
05:33 and setup, but things take time and the market is competent to that and there's a lot of
05:40 selling we are witnessing and will continue.
05:43 Right.
05:44 So that's with regards to Geo Financial Services.
05:47 Moving on, some good traction in the last two to three trading sessions in terms of
05:50 Adani Enterprises as well as Adani Ports.
05:53 What's your view on both these names?
05:55 Yes, in fact, Adani Enterprises promoters have increased their stake, which gives a
06:04 lot of comfort that at 68% stake also, they want to make it to 70 or even further, they
06:13 will increase their stake and putting so much fresh capital in the company, which is positive.
06:19 Along with this, if we see when they're shareholding better, DIs are not stellar in the last six
06:24 to nine months, FIs have increased their stake, GQG partner, from 16 to 20%.
06:31 So our new public float is now 5 to 6% left in Adani Enterprises.
06:36 And this will keep the stock in momentum.
06:38 So in my view, this is a stock which if anybody has bought, they can continue to remain invested.
06:45 Along with Adani Port also, fundamentally, this company is doing very good.
06:49 I'm expecting this year they will do approximately 380-390 million metric ton of cargo handling,
06:55 which will give you around 25,000 per top line and profitability wise also, robust profitability
07:02 numbers will come.
07:04 So Adani Port is stock which I can also touch and quote is at mark in next three to six
07:11 months time.
07:12 I'm bullish on Adani Port.
07:14 Right.
07:17 Let's talk about Patel Engineering.
07:20 Now they've emerged as one of the lowest bidders in a project in MP.
07:26 What's your view on Patel Engineering from an execution perspective as well?
07:30 And what would you advise investors to do?
07:32 Patel Engineering is again a turnaround, it's a very infrastructure segment company now,
07:41 doing very well, have almost 20,000 crore worth of order bookings.
07:46 Here only they won 7,700 crore worth of order.
07:50 And one beauty of this company is that 60% exposure is into dam and hydropower related
07:55 sector where there are not too many players venturing and it's not that competitive, but
08:00 at the same time, margins are high.
08:02 So I'm expecting they will do 15% to 17% kind of margin going forward also.
08:09 And this is a company surely to watch in longer run.
08:14 Moving on to the hotel space again, there's a lot of positivity floating around that hotel
08:22 companies are expected to do well in FY24 as well.
08:26 Lementree Hotels has signed a couple of deals recently.
08:30 How are you looking at Lementree Hotels and what would your view be on Lementee vis-a-vis
08:36 the other listed companies?
08:37 Yeah, Lementree is a given to my buying radar in my view.
08:42 This is a stock where the like profitability maybe 75% to 80% to 100% it can grow in next
08:51 three years.
08:52 Because again, the reason is the kind of traction which is developing in domestic hotel industry
08:58 because of COVID not too many people have travelled and after COVID there's a lot of
09:05 inclination among masses to travel.
09:07 And the way purchasing power is going up, people are easily able to afford now 6000
09:14 to 10,000 rupees per night room in B and C grade towns also.
09:20 So Lementree if you see, they are a major fortress into tourist destination and B type
09:25 of cities where a lot of events are happening and a lot of tourism is coming.
09:30 So like how they have tied up with Aswalee and Odisha, two properties.
09:35 They're continuously signing new newer properties.
09:37 So in my view, this is again a good stock to watch.
09:41 10 rupee paid up stock available at 105 rupees.
09:44 You can't go wrong.
09:46 And hotel industry in my view will continue to grow by at least 50% to 20% CGR in the
09:52 next few years.
09:53 So Lementree is in my buying radar for sure.
09:58 Right, that's with regards to where Lementree hotels goes.
10:02 Moving on, Brigitte Enterprises is in focus as well.
10:04 And this is on the back of the Chennai land deal for a residential project that has been
10:09 signed.
10:11 The stock did see some moves in today's session.
10:14 How are you looking at Brigitte Enterprises?
10:16 Because clearly with a lot of conversations that I've had with analysts, there is a clear,
10:21 you know, drift towards South East real estate players as compared to the Pan India ones.
10:28 How are you looking at it?
10:29 Yeah, I agree.
10:31 South East real estate companies will continue to grow because the kind of residential demand
10:38 and IT park related demand has come up in the system, which was not there during the
10:44 COVID period.
10:45 So a lot of interest is there among people to buy quality properties as well as new projects
10:53 because people want to shift from 2BHK to 3BHK from rental to their first buy house
10:59 when there are good salaries.
11:02 And definitely Southern India, if you see Hyderabad, Chennai, Bangalore, that market
11:07 there are more dominated by IT population.
11:10 And as people are not going on site, so most of the IT technical people are working from
11:19 India only.
11:20 So this has triggered good demand for middle and high end residential projects.
11:28 So Brigitte is also not an exception.
11:31 They are having half a million square feet for sale readily available.
11:36 And another 8 million square feet will come in the next 12 months, which will be generating
11:42 very good revenue for them.
11:45 The stock is already at 50 degree time, which shows investor confidence.
11:48 But in my view, this can be bought for longer.
11:53 Right.
11:54 Moving on, let's look at APL Apollo tubes.
11:59 That's an interesting one to focus on as well in today's session, because if you see the
12:04 stock, the stock is seeing some smart moves in today's session.
12:08 And this is on the back of a couple of comments that we've been hearing with regards to the
12:12 railway station modernization.
12:15 Now clearly, these are updates that did come in earlier with regards to 1300 railway stations
12:20 that will be updated.
12:22 But when the minister visited earlier, that's what they discussed as well.
12:27 What's your view on the APL Apollo tubes?
12:29 Railway or no railway, I think APL Apollo will continue to do well.
12:35 And the kind of metrics this company is putting in the system is quite encouraging.
12:39 They are having a capacity of 3 million tons of pipes already and 4,500 crores of capacity
12:48 they have done.
12:49 And this will be in like we can see the result in FY25 where their capacity will be around
12:56 5 billion tons.
12:57 And by FY30, they are talking of even achieving 10 million tons capacity.
13:02 So this is something quite encouraging as far as APL Apollo is concerned.
13:07 And this year, I'm expecting their one of the highest ever profit numbers.
13:12 I'm expecting at least 800 crores, they will make again 640 crores what they did in previous
13:18 year.
13:19 So this will be again a stock to watch.
13:20 So stock is at again at 52 week high.
13:23 But in my view, institutions are grabbing those stocks which are having good demand
13:29 visibility at the same time good management and good product.
13:32 So pricing is relevant for them.
13:35 I think sustainability is more important.
13:38 So this is the reason APL Apollo is again a good buy.
13:43 And very lastly, Wellspun India is another stock that we are watching out for.
13:47 They bought 50% stake in Michigan Engineers for around 137 crores.
13:53 How are you looking at Wellspun?
13:55 The stock did hit a 52 week high, surged little over 5% in trade today.
14:00 Yes, usually most of the stock we are discussing today are at 52 week high.
14:08 But there's a reason because in the bull market, like in this time, when there is any positive
14:16 development, people are not touching up any stock and they're buying quality stock.
14:22 So again, Wellspun is a good story.
14:25 As far as exports is concerned, they are Badlinen and Homeland, they are almost running at 100%
14:36 capacity.
14:37 And there's very good export demand for India.
14:40 People are ordering from China and most of the orders are coming to Indian market.
14:47 And we have seen in Wellspun, their Q1 numbers were very good.
14:51 Their EBITDA margin went up by almost 650 basis points, which is quite positive.
14:58 And in my view, this company will do well.
15:00 My target for this stock is around 850 in next six months.
15:05 And overall textile sector also looks good.
15:09 Right.
15:10 So that's in regards to Wellspun India.
15:13 Thank you, Ashish, so much for joining us on the show and sharing the views.
15:17 And clearly, you know, I mean, it is a day of stock specific action that we have been
15:21 witnessing.
15:22 And as Ashish was mentioning as well, a lot of stocks that we've discussed today are either
15:26 nearing their 52-week high or are at 52-week high.
15:30 And that's clearly telling you how big that market is in terms of being stock specific,
15:35 because in spite of these kind of moves, you're not seeing a major movement that's happening
15:39 in terms of benchmark indices as well.
15:41 They are far away from their 52-week highs.
15:44 But overall, you know, the underlying positive tone continues, and we're still hovering around
15:50 those 19,400 levels in terms of 50-50.
15:54 That's all that we have on this session.
15:56 Thanks for watching and lots more lined up on the other side.
15:58 Please stay tuned to BQ Prime.
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