Skip to main content

Traders ride bullish wave in PSU stocks

YouTube Video Thumbnail
Mumbai: Public sector companies emerged as some of the biggest gainers in Thursday's trading as traders rode the bullish wave in these stocks, helping them extend their winning run in recent months. Money managers and analysts said the government's increased spending plans, especially in defence, power, energy and railways sectors, coupled with cheaper valuations compared to the market are driving investor interest in the state-owned companies across the spectrum. On Thursday, shares of Cochin Shipyard soared 20% to an all-time high of ₹1,146. Mazagaon Dock Shipbuilders shares jumped by 9.51%. Indian Railway Finance Corporation, KIOCL, Power Finance Corp, REC rose by 4-7%. The BSE PSU Index gained 1.5% and the benchmark Sensex advanced 0.6%. Money managers said the pattern of government spending in the past few years has triggered a re-rating in PSU stocks. "Earlier, most of the PSU defence and shipping companies were primarily engaged with maintenance activities which formed a large part of their business," said Aniruddha Sarkar, chief investment officer, Quest Investment Advisors. "However, over the last 4-5 years and more so post-covid and post the Russia-Ukraine war, government focus has been on localisation of defence manufacturing as part of Atmanirbhar Bharat programme which has led to a significant jump in order books and cash flows for all these companies." Money managers said the power sector has been buzzing as industrial demand is at an all-time high with limited supply. "Prominent names in the power sector have an unparalleled asset base. When interest rates are high, capital-intensive businesses and asset heavy sectors do well," said Paras Bothra, CIO, Ashika India Alpha Fund. Time to be cautious? Though the upward momentum in PSU stocks may continue till the bullish sentiment lasts, analysts urge investors to be cautious as stocks could be overvalued. The BSE PSU Index gained 22.26% in the past six months as against the 9.8% advance in the benchmark Sensex. "Many of the names are trading at or below book, so not yet "expensive" on valuations but investors should avoid participating just because stocks have given good returns in the short run, and need to be cognizant of near term risks," said Lakshmi Iyer, CEO-Investment & Strategy, Kotak Alternate Asset Managers. "Unlike the last two years where almost all PSUs have done well, it may now be more prudent to be very stock specific in the PSU space." State-owned companies in defence, energy, mining and banking sectors could outperform the broader market over the next four to five years, said Sarkar, though the recent run up has resulted in valuations of some of them turning expensive. "We could see some time correction over next few quarters and investors should be careful about venturing there at these levels," said Sarkar Bothra expects the upswing to last for the next two to three years but said defence stocks valuation looks a little stretched.

Comments

Post a Comment

Popular posts from this blog

No man wants to date me Lady with unique nose cries bitterly Video

A pretty lady has gone online to lament bitterly over her singlehood as she attributes the status to their unique of her nose. The lady named Ammie Sweeshy cried out over her situation since no man appears to be approaching her or making any romantic advances towards her because of her nose. She made this known in response to a question a curious netizen asked inquiring if she has a boyfriend. Ammie could be observed crying in the video because no man seems to want her or making any romantic move to sweep her off her feet. Some netizens tried consoling her as they note that she's still pretty regardless of the nose. @dawgtreyna said: "Funny enough the nose actually fits you. You are still a fine girl though." @THE FASTEST BAGGER said: "You're so beautiful, don't let what people say ruin you. I'm single in case you need a boyfriend, let me know." @Princesseron commented: "Don't worry, dear. Even those who have small noses, some don't...
Post a Comment
Read more

Osho on Spontaneity

Osho on Spontaneity – Divine purity reduced to practical life means spontaneity Osho – Divine purity reduced to practical life means spontaneity. The spontaneous person is innocent. He has a quality that only children have, and that is the meaning of purity, innocence. He has the quality that animals have and the trees have and which man has lost. To be spontaneous means not to act out of the past, because out of the past is all cunningness, cleverness, calculation, arithmetic. When you act in the moment and it has no reference to your past, the action has a beauty, a purity – the same as a small child’s act. Whether he laughs or cries or goes into a tantrum or becomes angry, all his acts have purity – it is uncalculated. His anger is hot and not cold. The calculated anger is cold. His anger is natural, a responsiveness. He has not brooded over it, he has not planned it. He is just in the hands of nature – hence the beauty. He is surrendered to his nature; he is not trying to cont...
Post a Comment
Read more

British victory in Falklands War might spur Argentina to build nukes CIA feared

Agency worried that Argentina's political isolation following defeat could play a role in a decision to advance its nuclear program The CIA feared that British victory in the 1982 Falklands conflict would encourage Argentina's ruling military junta to step up its efforts to construct nuclear weapons, according to a newly uncovered report. Intelligence analysts at the spy agency examining the issue of nuclear proliferation wrote in a secret report that "the Falkland Islands crisis is raising security issues for Buenos Aires that could influence Argentine attitudes towards the development of nuclear technology." The report, dated 24 April 1982, said: "A humiliation in the Falklands probably would encourage the conclusion that the possession of nuclear weapons - or merely the foreign belief that Argentina had such weapons - might have made the UK more accommodating. A major reverse for Argentina in the dispute could persuade it to proceed to build nuclear weapons....
Post a Comment
Read more