Sep 07, 2017 01:23 PM IST | Source: CNBC-TV18
Aditya Narain, Head of Research, Edelweiss Securities from the sidelines of the Edelweiss Consumer Durable Day, spoke with CNBC-TV18 and shared his thoughts on the consumer durable sector and market overall.
According to him, consumer durables is a space where the companies can become be large. The business models of the some of the company have changed along with building up of their branding element, he says.
The house is bullish on companies like Symphony, KEI Industries, as well as Crompton Greaves.
The disruption seen in the first quarter for some of these companies could be on back of demonetisation and GST issue and may be seen in Q2 as well there could be some amount of disruption but their business models are changing for the better – they are moving into the branded discretionary spend area. So, it is unlikely that there is anything fundamentally challenging in terms of margins for these companies.
KEI Industries has received the most amount of interest from investors given its lower valuations, says Narain.
Talking of the outlook for the market, Narain says there is nothing to suggest a step back in terms of bullish call. The market will do well and remain valued reasonably high although there could be certain amount of levelling off.
“Nothing really changes with regards to the fundamental direction and the valuation framework for the market,” he adds.
With regards to the current geo-political tensions due to North Korea, he says the market has witnessed a lot of global events that have played through over the last couple of years and they have built up certain amount of cushion towards them.
Therefore, unless something really happens, there could be plus/minus 1-2 percentage impact on market but if something does happen, then the impact could be greater than 1-2 percent but notas catastrophic as some people believe such events could be, says Narain.