Goldman Sachs sees Nifty at 7,000, remains 'overweight' on Indian stocks
Goldman includes Bajaj Auto Ltd and Tata Steel Ltd in its Asia-Pacific "growth recovery" group of stocks that have favourable growth and valuations, according to its Asia-Pacific outlook report dated Jan. 4.
The bank sees Infosys Ltd as a stock with a potential "catch-up" opportunity after lagging in 2012.
Infosys shares fell 16.2 percent in 2012, widely under-performing the broader 27.7 percent gain in the benchmark BSE Index.
Goldman also highlights Tata Motors Ltd, Sterlite Industries (India) Ltd and Hindalco Industries Ltd as stocks with favourable macro exposure and attractive profiles versus regional peers.
Nifty seen touching 7000 mark in next 12-months : Goldman Sachs
Citing 'growth recovery' as a convenient backdrop for equities, Goldman Sachs set a 12- month target of 7,000 points for the 50-share Nifty, indicating a 17% upside from the current levels.
In its latest strategy report on Asia Pacific, the foreign brokerage said that after two years of stagnation, corporate earnings growth in the region is likely to accelerate to 13% to 14% in 2013-14 also as the GDP growth improves to 6.9% from 6.2%.
“ This is a favorable backdrop for equities, particularly given inexpensive valuations and conservative investor positioning,” Goldman said in the note. It assigned an overweight rating to markets of India, China, Korea and Singapore owing to favourable growth 'deltas' and attractive valuations.
Goldman expects, three key developments since its
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