Sanjeev Prasad, senior ED and co-head at Kotak Institutional Equities, remains positive on Reliance Industries (RIL) and State Bank of India (SBI).
On RIL, he said that "over the next one year, you would see some amount of positive news flow on account of commissioning of two new projects."
"In fact, the coal gasification unit could be commissioned by next quarter and by September it could be fully operational. After that, the gas cracker will get commissioned and by March I assume it would be up and running," he added. (Watch Video)
Mr Prasad expects RIL shares to go up to Rs 1,100-1,200 over 9 to 10 months, aided by the two projects and greater visibility in RIL's telecom business.
Mr Prasad also finds SBI attractively priced at current levels though there are some concerns on the asset side.
"There are concerns over the asset side. But SBI among the PSUs looks a lot better. If I look at Axis Bank, ICICI Bank and SBI on the asset side, all of them have similar issues. At least between the three, SBI is discounting a lot of bad news. SBI looks cheapest among the three. "
Market Outlook
Mr Prasad says that in the near term the market picture looks clouded due to the impending Federal Reserve rate action and because of concerns over whether the government will be able to pass through key legislations in the forthcoming winter session of Parliament.
But from a long term perspective, he is positive on the markets. "We have seen some signs of economic recovery. If the government continues to do some of the stuff (reforms) what we saw over last 2-3 weeks, then I am hopeful that over next 2-3 quarters we see revival in investment cycle," he said.
"The implementation of the Seventh Pay Commission will also give some impetus to consumption."
SOURCE - NDTV