Now Goldman Sachs has come out with a note on Titan, but there are a lot of pulls and pressures out there. Titan has been getting premium valuations forever, obviously, industrial leader. But there are other jewellery brands like Senco, Kalyan, others, they are doing phenomenally well. A lot of money is getting, flows are getting diverted to these names. Do you think Titan and they had a soft jewellery quarter, do you think Titan will come back or you think investor interest in some of the other jewellery name will remain alive?
I think, yes, this quarter, Titan numbers were slightly subdued. But when we look at the overall opportunity and given the way Tanishq brand has evolved over the last four to five years, I do not see any major challenge because at the end of the day, what matters is how big the market is and how Titan is positioned to take advantage of that through distribution channels and even the credibility and the lineage that this group commands, I do not foresee much of a challenge. I think there is a growth in terms of volume, given the kind of appetite that people have for jewellery and also, we feel that you will see stable margins once there is a little bit of stability in the gold prices. So, valuations, I do not think is too much of an issue. It is all about how big the opportunities and how Titan can deliver growth. We have a positive view. I think it is a part of the core portfolio.
In your current portfolio, how much tilt do you have towards policy stocks and how would you approach them before the election verdict?
If somebody wants to play the election as an event, then surely it would be good to have some exposure to the high beta names where you will see very strong delta if the event is in the favour in either ways, right?
So, Adani Group, Adani Port, Adani Enterprise, BEML, HAL, Larsen, some of the PSU banks, I think these are the stocks that one should have an exposure to. Of course, it is a big event. IVs are reflecting that 23-24, which we have not really seen before. But if somebody has an appetite and you want to play that event, surely these are some of the names that you should go with. Apart from that, I think one, smart way to participate in this event would be to do a 6th June Nifty bull call spread.
I think that is where you will be able to participate with a very limited risk. So, I think these are the names that one should go with to just play this event.
Have you been tracking Bata because the numbers were better than expectation, but I mean, it is still just a revenue growth of 2%. The margins have also come off a bit. And on the other hand, you had that blockbuster number come by from Campus yesterday and that stock was up 18%. Have you been tracking this footwear space at all?
Bata numbers have been softer though in line and just to give you a perspective, for last I think three or four quarters, the company is not showing any meaningful growth whereas some of the players like Campus, Metro Brands are actually delivering better growth.
My feel is that rather than going with a company which has a strong brand or legacy, it would make more sense to go with the companies which are delivering at the ground level.
No doubt Campus has run up 18%, but if there is a little bit of cool off, I will be more than comfortable buying into that. But also Metro Brands though is an expensive stock, I think it is the consistency of growth, the distribution strategy is much better vis-a-vis Bata. So, I would surely go with that.
Would you buy Vodafone now? Now, it is clear that the company has survived. Debt problem is behind. Price hike, if it kicks in, operating leverage benefits would be there. Do you think Vodafone Idea, which is at Rs 15, 14.5, can it go to Rs 20, even beyond Rs 20 in next one year?
The recent fundraise, the government support and the possibility of some further relaxation that can come through in terms of the AGR dues, it is possible that Idea can go up to about 18, 20 levels.
But there is a certain degree of uncertainty around it. It is a little bit high beta stock. Also, we have to reckon that the stock has run up after the FPO around Rs 11.
It has become a Rs 15, so there is a substantial appreciation which has already happened.
So, yes, if you are a small investor or if you have a high-risk appetite and you want to play a turnaround story, surely Idea could be one of the stocks to look at.
But if I want to play this telecom story, I think Bharti would certainly be the best stock to have as an allocation stock, even though it has been one of the best performing stock, this can easily give you 18%, 20%, 22% kind of a growth over the next couple of years.