Even as many other market voices are cautioning about an impending stock market correction, top investor Porinju Veliyath says that markets are healthy at current levels, and fears of a bubble are unfounded.
Even as many other market voices are cautioning about an impending stock market correction, top investor Porinju Veliyath says that markets are healthy at current levels, and fears of a bubble are unfounded. According to him investors must focus on compounders, where you can make 25-30% compounding for the next five years and 10 years. What is he betting on? In an interview to ET Now Porinju Veliyath, MD of Equity Intelligence India said that Hindustan Sanitaryware & Industries Limited, a smallcap could double investor wealth in a year.
“I always used to wonder, the HSIL stock used to be at Rs 700-800 crore market cap. It was the industry leader in this country at a time the industry was in infancy. So, I used to be surprised. Now it has come to some Rs 3,000-crore market cap. HSIL has still a long way to go. They are demerging the brand and distribution business. It is a very large business and it used to be underpriced. I think this stock can even double from here in the next one to two years’ time. The stock price is around Rs 450, Rs 3300 crore is the market capitalisation and I want to disclose that we are holding it in PMS,” the expert pointed out. HSIL shares closed at Rs 460.3, up by more than 0.2% on NSE.
The ace investor has been bullish on GVK Power and Infrastructure for quite some time now. Sharing that he owns 6.5% stake in the company, Porinju Veliyath quipped, “Last time when I went to Mumbai I was waiting for the flight in the lobby. I was telling my wife I own 3% of Mumbai Airport! So something nice to think about. There are leveraged infra companies and with the less leverage infra companies, infrastructure is definitely a theme and a story going forward.”
He also spoke about Tata Global Beverages, which has more than doubled since January. “In Tata Global Beverages, the undervaluation is just getting rectified, nothing much is happening. At Rs 120-125, it was wrongly priced for the same fundamentals and now that has rectified because the stock was identified or some large institutions have stopped selling. So, it has come to normal levels,” Porinju Veliyath told the channel.