Market guru Deven Choksey says metals and non‑bank finance firms are set for solid growth, while defence and electronic manufacturing services (EMS) look too pricey for short‑term gains.
Metals and NBFCs: The Bright Spots
Choksey is confident about the “white metals” like copper, aluminum and silver. Big spending on power projects and new data centres will need a lot of steel and metal, boosting demand.
In the non‑bank finance world, he likes Shriram Finance and Bajaj Finance. Both have strong capital, cheap funding, and a plan to double their balance sheets every four years, which could double investors’ money over a similar period.
- Shriram Finance – solid capital base, good funding costs.
- Bajaj Finance – similar strengths and growth targets.
A dip in their stock prices could be a good buying chance.
Defence and EMS: Why Caution Is Needed
Even though the government’s defence plans are clear and orders are steady, the market has already priced in growth for the next two to three years. With price‑to‑earnings ratios around 65‑70, there isn’t much room for the stocks to rise further in the near term.
The same story applies to EMS companies. The sector has huge potential, but current valuations are high after recent corrections. Choksey believes the stocks need to fall more before they become attractive.
Specific Picks to Watch
- Vedanta – considered relatively safe because of an upcoming split.
- Hindustan Zinc – could benefit from any price correction.
- Hindustan Copper – another metal stock with upside potential.
All three could offer more growth room than many peers.
Bottom Line
Investors might find better short‑term opportunities in metals and NBFCs, while staying cautious on defence and EMS stocks until valuations come down.
Disclaimer
Remember, this is just an opinion, not a prediction. Do your own research and consider your risk tolerance before making any investment decisions.