India has seen a serious second wave of the coronavirus pandemic as situations rose practically 4 instances from the preceding peak. However, stock markets stay resilient, and right after a 5% fall from all-time highs, benchmark indices are once more surging larger. This, according to international investment manager HSBC, is owing to the far better positioning of India Inc this time about. “Global liquidity remains supportive, and perhaps any significant market fall may be viewed as a buying opportunity,” HSBC stated in a current note. However, the second wave in HSBC’s view is more precarious than the initial one and might imply downside dangers to development expectations this fiscal year.
Nifty corrected 5% from the all-time higher in February, but has recouped some of the losses and is now nearing the highs once more. The existing phase of markets has been termed by HSBC as a brief-term vulnerability phase. “We believe the market could be very volatile depending on how the COVID-19 situation evolves but any deep correction is quite unlikely, making this phase a “vulnerability phase” inside the general bull industry,” they stated. While development might be hit due to the surge in situations, vaccination drive is most likely to act as the crucial catalyst for the industry.
Stocks to obtain
While valuations stay stretched at this juncture, HSBC finds possibilities in sectors that have seen a correction amid increasing coronavirus situations. These mostly include things like covid recovery plays such as India Hotels and Prestige Estates. While India Hotels is down 18% from its current highs, Prestige is down 14% in the last month.
- India Hotels target price tag – Rs 160
- Prestige Estates target price tag – Rs 380
Further, the report adds defensives and underperformers as feasible bets at this stage. Here, HSBC has picked Hindustan Unilever, Bharti Airtel, and Axis Bank.
- Hindustan Unilever target price tag – Rs 3,000
- Axis Bank target price tag – Rs 800
- Bharti Airtel target price tag Rs 700
HSBC also sees beneficiaries of the new normal as feasible picks. These include things like healthcare and wellness plays such as CIPLA and IPCA Labs, along with Marico.
- CIPLA target price tag – Rs 1,055
- IPCA Laboratories target price tag – Rs 2,530
- Marico Industries target price tag – Rs 510
Lastly, the report advises investors to bet on structural winners. Under this category, HSBC picked Titan Company, Asian Paints, Bajaj Auto, ICICI Bank, and Bajaj Finance.
- Titan target price tag – Rs 1,800
- Asian Paints target price tag – Rs 3,150
- Bajaj Auto target price tag – Rs 4,300
- ICICI Bank target price tag – Rs 670
- Bajaj Finance target price tag – Rs 6,375
(The stock suggestions in this story are by the respective analysis and brokerage firms. TheSpuzz Online does not bear any duty for their investment suggestions. Please seek the advice of your investment advisor just before investing.)