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  1. Want to ride India Infrastructure boom? Here are Jefferies’ top stock picks

Want to ride India Infrastructure boom? Here are Jefferies’ top stock picks

Jefferies LLC, an American global investment bank is bullish on the infrastructure space in India. According to the firm, the coming quarters will see a lot of infrastructure projects execution.

By: | Updated: September 28, 2017 11:19 AM
Jefferies LLC, an American global investment bank is bullish on the infrastructure space in India. (Image: Reuters)

Jefferies LLC, an American global investment bank is bullish on the infrastructure space in India. According to the firm, the coming quarters will see a lot of infrastructure projects execution. The research firm has suggested Ashoka Buildcon as a buy with a target price of Rs 190. The shares were trading at Rs 183.9, up by more than 1% since the previous close on NSE. Sadbhav Engineering Ltd is also a buy with a target price of Rs 330. Sadbhav Engineering Ltd was flat at Rs 288 this morning. The target price for the scrip implies a potential upside of more than 14% from the current levels. Jefferies has set a target of Rs 221 on IRB Infrastructure. The shares were trading at Rs 210, up by more than 2% since the previous close.

Porinju Veliyath, CEO and MD of Equity Intelligence India, is bullish in the prospects of the Infrastructure space in the next 10 years. He believes that there maybe a few L&Ts in the making. L&T has a market capitalisation of more than 1,64,000 crores. Porinju believes that currently, there are at least 2-3 large companies in the sector, which have the potential to reach the 1 lakh market capitalisation figure in the next decade. Speaking to BTVi recently, he said, “ In the next 10 years, the infrastructure development in India is going to be a huge game changer. I’m looking at the next L&Ts”.

According to the expert, L&T is a very professionally managed company with huge execution capability. Porinju predicts that this sector is going to witness tremendous growth in the near future, and companies with dynamic management and proven track record are good bets. 

He feels that even though there may be strained balance sheets as of now, the profitability seems to be improving in the space. In the same conversation he said, “I’m able to see atleast 3-4 large companies in the infra space at this point of time. The latest annual reports and balance sheets of these companies look attractive.”

According to Jefferies, the traffic growth is likely to remain tepid in Q2, just like the previous three quarters. The Nifty Infrastructure Index is up by more than 18% in the year. Notably, it has shed more than 2% in the last one month.

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