Things are heating up for the markets. You had warned of this kind of weakness and volatility in the markets. What next? Do you see this weakness continue for some more time?
Sanjiv Bhasin: Yes, we had warned investors to take some money off the table. There was too much froth and that played out well. We have seen commodities lead the rally – gold and silver – and stock specific move.We still think there is a little bit more bloodletting coming. However, in the short run, after 22,800, if you fall to 22,150, there should be a lot of support here.

We are looking at one pullback rally because all negatives are slowly getting priced in. Now, in this atmosphere, greed and fear play out perfectly. So, one has to balance oneself. Right now, it is better to be a trader and try to hedge your positions on the short side also. But look for good entry points into stocks, which we think are giving a very good opportunity. So, even at this level, we are finding very good largecap plays, which we think can weather this storm and perform even better in the coming weeks and months.

Let us hear that list everyone is waiting to hear that out. Where is it that you are safer in this kind of global market environment?
Sanjiv Bhasin: HUL is my top pick. Now, we have been doing a SIP for the last week from 2250 downwards. The simple reason is that rainfall is going to exceed estimates. Also, we think that the food security and the other harvest side is going to be very pleasantly surprising. Inflation is well-contained. In the upcoming election, the biggest beneficiary will be rural income. Lever is a must have in your portfolio. It has corrected from Rs 2,700 and now the risk reward is to book out of some of the heavy performing FMCG and get into Lever.

Lever is going to be a classic play for a defensive/rural income theme where the rising incomes and lower inflation and better monsoon is going to be forecast. At this price, we would say a SIP in Lever offers just a Rs 50 downside but a Rs 400 upside.

Second, we are very positive on stocks like LTI where there is negative news flow of some resignation. But that was already played out by insiders. LTI, according to me, has a very good risk reward at Rs 4,800. We could look at the upsides there. The third pick would be Indiabulls Real Estate. You should be booking profits in the heavy duty names of Godrej and DLF and getting into this stock With Rs 6,500 crore market cap, Rs 4,000 crore infusion and now looking to go for visible assets, which are cell phones. There is no liability on that. Indiabulls Real Estate could be a very sweet spot. Today, you could also add on dips ICICI Bank which could come out with the best ever results. So, these four-five stocks should give a good portfolio pick. But do not miss the woods for the trees. HUL is looking very attractive after an almost 18% correction.

What is your take on Bharti Hexacom? Jefferies is very bullish saying it is the best play within Indian telecom and in the long haul, FY24 to FY27 they are seeing a 16% to 21% CAGR. Your take?
Sanjiv Bhasin: Jefferies has also upgraded my old favourite IDFC Bank. If IDFC Bank is going to Rs 120, then Bharti Hexacom can join the rally. I think it is a very good play on the aspirational levels which are rising as far as data and so on. But I would bet on the contrary, I think the opportunity which is coming in Voda-Idea will be once in a lifetime, that stock is going to change patterns. You must subscribe in that Rs 10-11 bracket and that stock could be the stock of the year. So, we are preserving cash. We are very bullish on IDFC First. It has been my pick from Rs 30-35. Jefferies has upgraded that target also. I would subscribe very heavily in whatever quantity and cash you have into Voda-Idea. That would be a better pick than the listed names which are already trading at premiums.

All excitement on Elon Musk’s visit to New Delhi, 21st, 22nd and a lot of chatter around who he is going to be meeting other than the prime minister. It seems the Tata Group seems to be the chosen one, at least that is what the reports are indicating. Any play around the EV infrastructure that one could look at right now?
Sanjiv Bhasin: It has already played out in the battery stocks, they have more than doubled. Exide is at Rs 420 and now coming with an upgrade of targets. Elon Musk, basically, his stock has underperformed, it is down 37% year to date, so I think he is trying to make headway now into India and Tesla is a much needed impetus, I do not know how successful it will be, but yes and he is tying up with the right partners, Tatas are the right people to be.

But it also tells you that in the longer term, India is the destination and this PLI and China plus one policy is telling you that we are getting everything here. 30 years back, Apple forayed into China in a big way and now everything is coming to India. I was in London recently, all the brand ambassadors of the fashion side are Indian actresses or models. When did you see that?

So, that is a sign of India being the most touted investment globally and the demographic premium playing out perfectly. So, look for some of the EV plays as far as the input costs go like batteries and all, which have already run up in anticipation. I think Tatas will be the best beneficiaries of that. It also highlights that now Apple is looking to expand its base. So have Bosch and those stocks performed exceedingly well in the near term and in the medium term.

Another of your recent calls, ONGC has played out very well and a mammoth move yesterday too, part of the crude spike beneficiary and of course a brokerage upgrade as well coming in. Now what? Do you think the meat of the rally has already played out in ONGC or can someone still look to buy afresh?
Sanjiv Bhasin: Vedanta and ONGC have been two of my top picks, which have done exceedingly well. From that 260-270 Vedanta zoom to 390. I will even see 490 coming. Look at where silver prices are. Look at where zinc is, copper and they are the only producer of nickel in the country. ONGC is a churn company.

All the PSUs got re-rated. ONGC for me is a Rs 400 stock. Simply put, their capex is showing that their return on equity and reduction of debt is part and parcel of the cash accruals. Government reforms in the oil sector and gas have been exceedingly positive and I think the earnings are very key. This stock has hardly any float as far as mutual funds and FIIs go. There will be a beeline once it crosses Rs 300 or the previous Rs 295. Rs 390 to 400 is my target on ONGC. Use all declines to buy ONGC and Vedanta. They should be outperformers.

Given the fact that reports have spoken about how 57% of India’s total apparel market and within that, the value fashion segment is one of the fastest growing. Latest news indicates that Inditex is going to bring Bershka and Zara Home to India. What does this spell out for the listed players?
Sanjiv Bhasin: Well, very similar names. I was on a holiday and all I saw was the shopping by the ladies in those names that you said. And it is strange and uncanny now you have everything in India. I think the flavour of the day, month, year and the decade and the century is going to be India. It tells you that the brand ambassadors or those industries are doing very well. Case in point, Zomato, PB Fintech. Maybe insurance and food have not done as well as the service providers and that will be the case for the players who come in as far as the franchise goes.

But it is evident that the rising middle class income is giving an opportunity for big brands to make foray in India and that means all dips are buying opportunities if you have the correct selection of stocks and patients. But yes, this is a very optimistic view on India going forward that largecap brands are making a foray. I told you that the best of ladies’ makeup, ladies’ lingerie all are being flouted by top models from India rather than some of the overseas names which makes you more patriotic and bullish on India.