1. Samvat 2074: Basant Maheshwari bets big on IPOs; Housing Finance stocks

Samvat 2074: Basant Maheshwari bets big on IPOs; Housing Finance stocks

Even as many experts are taking stock of the performance of Samvat 2073, and recommending a plethora of stocks to watch out for, Basant Maheshwari, says that IPOs will offer new ideas in Samvat 2074.

By: | Published: October 20, 2017 9:59 AM
IPOs, housing finance are among Basant Maheshwari’s top bets in Samvat 2074. (Image: Reuters)

Even as many experts are taking stock of the performance of Samvat 2073, and recommending a plethora of stocks to watch out for, Basant Maheshwari, Author & Portfolio Fund Manager, Basant Maheshwari Wealth Advisers LLP, says that IPOs will offer new ideas in Samvat 2074. In an interview to ET Now, Basant Maheshwari said, “ At the moment, we don’t have any new ideas. We’re waiting for the IPO pipeline. New ideas will come from the IPO markets. The IPO stocks over the last one year has been fabulous.”

The IPO markets are buzzing with activity even as India headed for a record amount of money to be raised in the primary markets this year. According to an EY report, IPO volume in the first nine months of 2017 has already exceeded the full-year totals for 2016. EY says that emergence of larger listings could help the country far exceed the initial expected target of $5 billion in proceeds this year.

At such a time many experts have expressed varied opinions on primary issues. Mohnish Pabrai, a leading US-based investor told ET Now last week, “There is a very simple rule of investing I follow, which is, never ever invest in any IPOs. So first off all an IPO is a company selling shares into the market. The company controls the timing, the company controls the story…. These are auction-driven entities basically tend to give us a pricing that goes to extremes.” He instead suggests giving money to professionals, saying that investing in IPOs is going to hurt more than it is going to help.

Basant Maheshwari is betting big on housing finance sector. “My Diwali idea would be housing finance” he told the channel. In an interview to CNBC TV18, Mahesh Nandurkar, India Strategist CLSA said on Wednesday, “We have been bullish on housing as a theme for quite some time now. Property affordability in the market is the next growth driver for housing.” According to him, the housing sector had been under pressure due to demonetisation and GST. “ Prior to last Diwali, we did have a good phase in the sector. But, post that we had demonetisation and then GST and the impact of RERA, which has pulled us back a little bit,” Mahesh Nandurkar told CNBC TV18.

Now, there are green shoots of recovery in the sector, as the government has taken a lot of initiatives and the property affordability, especially in the middle and lower income group has considerably improved, says the expert. “The property affordability, for middle and lower end of the market, which accounts for more than 80-85% of the total housing transactions in the country, will be the driver for economic recovery.  Some initial signs of that recovery are visible, as trigger for that is being provided by the government, whether home-loan subsidies are given to borrowers, or tax incentives for developers etc,” Mahesh Nandurkar pointed out, adding, “The numbers posted by developers have been okay for the September quarter, and this trend is likely to continue for the next few quarters.”

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