NBFCs are an interesting story, have an edge over banks: Dipan Mehta, Member, BSE & NSE

BSE & NSE Member Dipan Mehta has a shopping list ready and remains gung-ho about the prospects of secular consumption oriented themes. Mehta tells ET Now that they are the way forward.

ET Now: You mentioned that you are already making that shopping list of yours. Give us a flavour of what are the names that you have added in there?

Dipan Mehta: Well, I think the NBFC space still remains quite interesting and some amount of concern has come around rising yields or the borrowing cost, but then that gives an opportunity over here. NBFCs in certain segments, be it micro finance or gold loans or used vehicle financing loan against properties, they do have an advantage over banks.


A few NBFCs like say Capital First or Bajaj Finance, Chola Mandalam Finance and Shriram Transport certainly make it to our shopping list. Other companies that have done exceedingly well which we may have missed out over the past quarter or so -- the likes of say Titan Industries or Jubilant Foodworks and Jubilant Foodworks have been impressing us. So, one could try to get into those kinds of secular consumption oriented stories. There is Eicher, there is Maruti as well that do not go for large cap versus midcap kind of a classification, but wherever we are seeing secular growth momentum like 15-20 per cent assured growth over the next three, four years or so.

These stocks mind you were earlier available at PE multiples of anywhere from 35 to 50 times and now if they are available may be 15-20 per cent cheaper or so, then that is the best way to ride the stock market over the next year or two or so. That is the kind of strategy that we are applying in this market. Go for the best quality stocks, the bluest of blue chips when the market is down and that is the time you can acquire these companies. Otherwise, they just do not give you an opportunity. The valuation obviously remains a mindblock and you are never able to get adequate exposure to such companies.