Many times, the street tends to make a bucket of stocks and a narrative gets created that that these stocks have similar characteristics and hence they tend to move in a similar direction. While this might be correct for some time, but over a period of time, especially when there are headwinds, some companies either diversify into new areas or for any other reason, while the mother set of characteristics remain the same, they become different from each other. Let s take the case of mega cap or the top five IT companies, while the narrative is that they are all the same, the fact is the stock of HCL tech is much higher than what it has formed in the last quarter of 2021 which was the time when all other mega cap IT stocks touched a new high. Essentially, even the companies which look very similar could be very different, in business and their stock performance could also be very different.
“These last two years, especially the last six to seven quarters, have been PSU banks. The numbers have been better and what the management has guided, most of the banks have delivered that way.”
“Anybody who is not invested to answer your questions can start with small tranches within the midcap IT space. We like a couple of names which we hold in our global list. Cyient we continue to like because of its diversified book, expectations of stable revenue growth and Firstsource Solutions meets a lot of our criteria in terms of revenue expectations, capacity utilisations, decent amount of DSO days and a decent amount of diversified book.”
Even as the Nifty IT index has marginally underperformed the broader Nifty50 on three, six and 12-month basis, the midcap and smallcap IT stocks have outrun all indices, Nuvama said, adding that some quality tier-2 IT firms delivered "eye-popping returns".
“The conditions are basically playing a major role in giving a good amount of business to most of the hospitality players – be it Indian Hotels, East India Hotels or even the mid-tier small hotel segment. Be it ITC, be it Indian Hotels, the hospitality heroes have all been following the asset-light model strategy now, wherein most of the properties that they are working on now is on an operational management contract, vis-à-vis earlier situation of owning the assets.”