Mumbai, the financial capital of India, is poised to witness significant growth as the corporate sector gears up for a robust second half of the fiscal year. According to market expert Neeraj Dewan, while Indian markets may remain range-bound, stock-specific opportunities are on the rise. With earnings expectations for Q3 and Q4 looking promising, Dewan expresses optimism particularly in sectors such as capital goods, infrastructure, defence, and housing finance.
Dewan emphasizes that the upcoming quarters traditionally see enhanced order flows and execution, thus he is becoming increasingly positive about the prospects for capital goods and engineering companies. The sentiment is shifting from muted earnings to a more positive outlook, as highlighted by Dewan, who states, "We are seeing an uptick, and Q3-Q4 should deliver better numbers." He identifies sectors with heavy orders as likely benefactors of this positive trend, which is crucial for investors looking for growth opportunities.
In the defence sector, Dewan maintains a bullish stance, advising that it is suitable for patient investors with a longer-term view. He suggests focusing on established companies that demonstrate strong execution capabilities. Noteworthy mentions include Mazagon Dock and BEML, which he considers top picks in shipbuilding and diversified defence. His cautious outlook on the sector underscores the importance of strategic investment choices.
Furthermore, Dewan points out the logistics and port industry, highlighting Adani Ports for its strong execution track record and consistent performance in meeting EBITDA and debt guidance. While he acknowledges the long-term potential of JSW Infrastructure, he cautions that its current valuations may appear stretched. This assessment reflects a careful evaluation of the market dynamics and the need for prudent investment strategies.
In the realm of capital markets, Dewan shows a preference for infrastructure-driven businesses such as CAMS, Kfin Tech, CDSL, and NSDL, which are likely to benefit from the increasing retail participation in India. However, he advises caution regarding recent market entries like Groww, suggesting that following a sharp post-listing rally, it may be prudent for investors to book profits. Overall, Dewan's insights provide a roadmap for navigating the evolving landscape of Corporate India as it prepares for a strong finish to the fiscal year.
