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    This midcap can be a dark horse and give 50% return Diwali to Diwali: Sanjiv Bhasin

    Synopsis

    “Among largecaps, I cannot promise safety but given the type of pedigree and the demand for fixed assets in the shape of real estate, DFL is going to go up with all guns blazing. I would be a little bit more risk taking and take DLF as my tarka stock.”

    Sanjiv-Bhasin-1200ETMarkets.com
    “Can Fin Homes has a book of Rs 40,000 crore and a market cap of Rs 6,500 crore. They have assured us that an external CEO will come by the end of next month. Plus, they have a big reach in the Rs 8-15 lakh space. LIC has a lion’s share of the business and I am very positive on Can Fin Home,” says Sanjiv Bhasin, Director, IIFL Securities

    Can you give us a safe name to invest in this Diwali?
    Safety comes with a little bit of risk but if I had to say a safe name, it would be DLF. Arguably DLF has been a relative outperformer, even when it falls on worst case time, it does not break below Rs 340. Look at their land bank, the type of construction activity and the unprecedented realisation. They have become almost debt-free, 80% debt is gone. At the beginning of the Shradh period, they launched new floors to be sold and before the first Navaratri, they had sold 290 flats worth Rs 1,800 crore.

    So I cannot say safety but given the type of pedigree and the demand for fixed assets in the shape of real estate, DFL is going to go with all guns blazing. So, I would be a little bit more risk taking and take DLF as my tarka stock.

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    But interest rates are going up and that is a very big parameter over there. Everybody is talking about affordable housing, the cost of housing is going up. Do you think that these variables do not matter over a medium term when you look at a stock like DLF?
    They do matter but in a marginal way. What has been the experience of real estate in the last 10 years? Rather than going for an under quality stock which promised a lot but delivered little, you should rather stick with the Godrej or DLF because there is pedigree and a slight bit of heartburn on rates is not going to be detrimental. People want quality. They want a promise of a given house when they want it.

    I definitely think DLF is going to fit all criteria and this is a myth about input costs. That in fact has fallen 30% in the last three months. I still think that they will have the biggest advantage of resale sales.

    Your first pick was ICICI Bank which is a safe stock, then a great Birla company which is UltraTech, then you came up with IndiGo as one of the wild and spicy stocks that you would have and then a DLF stock which will give you stable returns because of the sort of cyclical up move, What will be that one midcap in your portfolio, which can do very well?
    It would be Can Fin Homes. The numbers were very smart. They have a book of Rs 40,000 crore and a market cap of Rs 6,500 crore. They have assured us that an external CEO will come by the end of next month. Plus, they have a big reach in the Rs 8-15 lakh space. LIC has a lion’s share of the business and I am very positive on Can Fin Home.

    It can be such a dark horse that it can give a 50% return from this Diwali to the next.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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