Laggards coming on top of the markets

Mumbai: The week has begun on a positive note with the market opening in the green and buying picking up in certain sectors. Interestingly, experts aver that while favourites like bank and telecom stocks seem to be taking a breather, the laggards like metals, FMCG and cement appear to be making a comeback.

Technical analyst Ashwani Gujral says stocks like Gujarat Ambuja, Nalco and Dabur are making a comeback.

As a whole, Gujral says, the FMCG sector has to pick up even more resulting in the market getting more support going forward.

He says HLL is moving sideways between Rs 225 and 250, and that the range is now narrowing. “In time to come, if it passes Rs 250, one could probably see sharp moves to about Rs 285-290.”

While ITC has been weakening, Gujral says that Dabur has made a very encouraging move that it could probably move to Rs 157 if the entire space picks up.

Examining the FMCG sector, Anup Maheshwari of DSP Merril Lynch says the topline growth is intact. Thought raw material prices remain a concern for the market, the top companies within the sector have performed well.

Moving ahead, if raw material pressures ease, Maheshwari believes that stocks within the sector outperform market expectations. “It could be an interesting sector to look at, “ he adds.

From the metal space, Hindalco Industries is doing well. According to Vibhav Kapoor of IL&FS Investmart, one could hold Hindalco Industries with a long-term horizon of 12-24 months.

Sterlite Industries, currently trading in the green, could be good pick for those who are looking for a long term investment plan, according to Amit Dalal of Amit Nalin Securities. “I have great respect for that company and the management. They have ability to think on global scales and they have implemented that in the past.”

Moving to the cement space, Broking house, P-sec maintains that Gujarat Ambuja Cements is a value pick and recommends buying on declines.

ACC is expected to be a big beneficiary of a likely cement super cycle in India over the next few years. Deutsche Bank research has recommended buy rating on Associated Cement Companies with a target of Rs 1201.