Expert Take: Time to bet on capex-driven companies and banks

Hence, it makes more sense to invest in India Centric capex-driven companies. Large companies like L&T and Siemens are expected to see better times going forward as the government increases its spending to push growth in the economy. These companies are clear leaders in their areas of operations and are well-positioned to take advantage of the opportunities created by advancements in technology.

Smaller companies like Schneider should also be watched closely as they could benefit from the government’s push for increased infrastructure spending. These companies are likely to see growth as the government focuses on areas like renewable energy, electric mobility, and smart cities.

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Banking by virtue of higher credit growth and visible green shoots in private capex, coupled with retail demand in our view makes a good compounding story going forward. Large banks with wide footprints like ICICI Bank, SBI, BOB, and Canara Bank make a good investment case since their valuations are reasonable compared to their peers in the private sector banking space.

Overall, investing in companies that are focused on capex-driven growth and are well-positioned to take advantage of the government’s push for increased infrastructure spending could be a good strategy for investors in the current environment. Additionally, investing in banks with a wide footprint and reasonable valuations could also be a good option for those looking for long-term growth opportunities in the Indian market.

The author, S Ranaganathan is Head of Research at LKP Securities

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.