ET Now spoke to Gajendra Nagpal, CEO, Unicon Financial Solutions, on his views on the telecom stocks.
ET Now: What's your assessment of Reliance Communications?
Gajendra Nagpal: I do believe that at this time things are little different and Etisalat is fairly close to acquiring 26% stake in the company. We have been hearing about the commitment and if you go back to the time of MTN-Bharti deal, the government had come under a lot of criticism in the sense of not allowing free cross border acquisitions.
We had known that Indian companies were going out and wanted to acquire the companies abroad and wanted to enhance their visibility and global presence. I think at this time the government is far more liberal towards these companies.
I believe that Etisalat deal is going to go through this time and that is probably why the stock has been up by 2.5%-3%. This time the uptick looks more credible than in the recent past.
Jul 30, 2010
Large caps a safe bet
ET Now: Given the near term weakness that we are seeing on the indices, what is that you are buying this morning, if at all?
Gajendra Nagpal: The kind of weakness that we saw over the weekend in the US markets led us to believe that there could be a pause in the rally, but the way SGX Nifty has been behaving, it seems that though the market opening could be on the lower side, significant fall is ruled out.
I do believe that in such circumstances, when the market is throwing up an uncertainty in the near terms, the safe haven could be the large cap stocks. I think when there are macro level challenges, when one is not sure as to how it is going to pan out, because there has been a talk of double dip depreciation happening again in the US, I think the safe haven could be the large cap stocks which have been doing well.
So in that sense I would want to bank upon stocks like L&T, State Bank of India and BHEL. I think these are stocks which have shown a credible performance over last few months and a few trading sessions and I think that they would continue to give you some kind of solace from the uncertain markets.
Gajendra Nagpal: The kind of weakness that we saw over the weekend in the US markets led us to believe that there could be a pause in the rally, but the way SGX Nifty has been behaving, it seems that though the market opening could be on the lower side, significant fall is ruled out.
I do believe that in such circumstances, when the market is throwing up an uncertainty in the near terms, the safe haven could be the large cap stocks. I think when there are macro level challenges, when one is not sure as to how it is going to pan out, because there has been a talk of double dip depreciation happening again in the US, I think the safe haven could be the large cap stocks which have been doing well.
So in that sense I would want to bank upon stocks like L&T, State Bank of India and BHEL. I think these are stocks which have shown a credible performance over last few months and a few trading sessions and I think that they would continue to give you some kind of solace from the uncertain markets.
Commodity stocks may be weak in the near-term
ET Now spoke to Gajendra Nagpal, CEO, Unicon Financial Solutions, on his views on the market.
ET Now: Do the banking and IT numbers give you confidence? Where will you find value in sugar and metals, or do you prefer private sector banks?
Gajendra Nagpal : As you rightly pointed out, the markets have been so efficient these days that whatever good or bad happens immediately the prices start reflecting the trend. We have been talking of Sesa Goa results today and results are likely to be good but at the time we have heard reports coming in from some of the big FII research outfits that they could underperform going forward.
So its very important for all the discerning investors to keep an eye on all the events that are happening around us. I think the results so far has been very good and we are very hopeful of the results of large cap stocks which would be obviously coming in over next few trading sessions but I do believe that from a medium to long term standpoint, Indian economy is offering you a great opportunity.
While I would not immediately be gung-ho about stocks like sugar and metal because of the news that came over the weekend from the US and also the fact that Chinese economy is slowing down. There could be challenges in the short term for the commodity space but then obviously it's a great opportunity for a country like ours where we are also growing at a fairly strong pace and these commodities are available to us at cheap valuations.
So there could be an advantage for certain domestic companies like L&T or BHEL, which are great consumers of these commodities. As regards banking space, a lot of money which was for 3G auction is going to come back to the economy sooner than later. So there will be lot of money available in the market for corporates so if the economy does well as we believe it will, I think banking stocks are likely to do as well or even better.
ET Now: Do the banking and IT numbers give you confidence? Where will you find value in sugar and metals, or do you prefer private sector banks?
Gajendra Nagpal : As you rightly pointed out, the markets have been so efficient these days that whatever good or bad happens immediately the prices start reflecting the trend. We have been talking of Sesa Goa results today and results are likely to be good but at the time we have heard reports coming in from some of the big FII research outfits that they could underperform going forward.
So its very important for all the discerning investors to keep an eye on all the events that are happening around us. I think the results so far has been very good and we are very hopeful of the results of large cap stocks which would be obviously coming in over next few trading sessions but I do believe that from a medium to long term standpoint, Indian economy is offering you a great opportunity.
While I would not immediately be gung-ho about stocks like sugar and metal because of the news that came over the weekend from the US and also the fact that Chinese economy is slowing down. There could be challenges in the short term for the commodity space but then obviously it's a great opportunity for a country like ours where we are also growing at a fairly strong pace and these commodities are available to us at cheap valuations.
So there could be an advantage for certain domestic companies like L&T or BHEL, which are great consumers of these commodities. As regards banking space, a lot of money which was for 3G auction is going to come back to the economy sooner than later. So there will be lot of money available in the market for corporates so if the economy does well as we believe it will, I think banking stocks are likely to do as well or even better.
ONGC hits a month's low on poor Q1 show
State-owned Oil and Natural Gas Corp (ONGC) today tanked nearly 2 per cent to a month's low before making amarginal recovery in the early trade, a day after it reported a 24.5 per cent decline in its net profit for the quarter ended June 30.
Disappointed by the results, shares of ONGC plunged 1.72 per cent to a month low of ` 1,221.10 on Bombay Stock Exchange. However, the scrip made marginal recovery of 0.62 per cent later in the morning at ` 1,228.80.
On National Stock Exchange, too, the scrip slid by 1.49 per cent, to trade at ` 1,227.95.
"The results of the company are not that great, so the investors are booking profits. Such negative reaction is normal after results, especially, when the recent upside in the stock was already trapped by the investors," Unicon Financial Solutions CEO Gajendra Nagpal said.
Meanwhile, the broader benchmark, Sensex, too, was trading weak at 17,931.76, down 0.33 per cent from previous
close, on the poor quarterly show by companies including ONGC.
Yesterday, the oil and gas major had reported a net profit at ` 3,661.14 crore for the quarter ended June 30, against ` 4,847.92 crore in the same period previous fiscal, after its fuel subsidy payout jumped nearly 12-folds.
ONGC had paid ` 5,515 crore in April-June quarter towards fuel subsidies as against ` 429 crore in the year-ago period.
Disappointed by the results, shares of ONGC plunged 1.72 per cent to a month low of ` 1,221.10 on Bombay Stock Exchange. However, the scrip made marginal recovery of 0.62 per cent later in the morning at ` 1,228.80.
On National Stock Exchange, too, the scrip slid by 1.49 per cent, to trade at ` 1,227.95.
"The results of the company are not that great, so the investors are booking profits. Such negative reaction is normal after results, especially, when the recent upside in the stock was already trapped by the investors," Unicon Financial Solutions CEO Gajendra Nagpal said.
Meanwhile, the broader benchmark, Sensex, too, was trading weak at 17,931.76, down 0.33 per cent from previous
close, on the poor quarterly show by companies including ONGC.
Yesterday, the oil and gas major had reported a net profit at ` 3,661.14 crore for the quarter ended June 30, against ` 4,847.92 crore in the same period previous fiscal, after its fuel subsidy payout jumped nearly 12-folds.
ONGC had paid ` 5,515 crore in April-June quarter towards fuel subsidies as against ` 429 crore in the year-ago period.
ONGC hits a month's low on poor Q1 show
State-owned Oil and Natural Gas Corp (ONGC) today tanked nearly 2 per cent to a month's low before making amarginal recovery in the early trade, a day after it reported a 24.5 per cent decline in its net profit for the quarter ended June 30.
Disappointed by the results, shares of ONGC plunged 1.72 per cent to a month low of ` 1,221.10 on Bombay Stock Exchange. However, the scrip made marginal recovery of 0.62 per cent later in the morning at ` 1,228.80.
On National Stock Exchange, too, the scrip slid by 1.49 per cent, to trade at ` 1,227.95.
"The results of the company are not that great, so the investors are booking profits. Such negative reaction is normal after results, especially, when the recent upside in the stock was already trapped by the investors," Unicon Financial Solutions CEO Gajendra Nagpal said.
Meanwhile, the broader benchmark, Sensex, too, was trading weak at 17,931.76, down 0.33 per cent from previous
close, on the poor quarterly show by companies including ONGC.
Yesterday, the oil and gas major had reported a net profit at ` 3,661.14 crore for the quarter ended June 30, against ` 4,847.92 crore in the same period previous fiscal, after its fuel subsidy payout jumped nearly 12-folds.
ONGC had paid ` 5,515 crore in April-June quarter towards fuel subsidies as against ` 429 crore in the year-ago period.
Disappointed by the results, shares of ONGC plunged 1.72 per cent to a month low of ` 1,221.10 on Bombay Stock Exchange. However, the scrip made marginal recovery of 0.62 per cent later in the morning at ` 1,228.80.
On National Stock Exchange, too, the scrip slid by 1.49 per cent, to trade at ` 1,227.95.
"The results of the company are not that great, so the investors are booking profits. Such negative reaction is normal after results, especially, when the recent upside in the stock was already trapped by the investors," Unicon Financial Solutions CEO Gajendra Nagpal said.
Meanwhile, the broader benchmark, Sensex, too, was trading weak at 17,931.76, down 0.33 per cent from previous
close, on the poor quarterly show by companies including ONGC.
Yesterday, the oil and gas major had reported a net profit at ` 3,661.14 crore for the quarter ended June 30, against ` 4,847.92 crore in the same period previous fiscal, after its fuel subsidy payout jumped nearly 12-folds.
ONGC had paid ` 5,515 crore in April-June quarter towards fuel subsidies as against ` 429 crore in the year-ago period.
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