Buy Hindustan Lever: Ajay Srivastava
Hindustan Lever has very strong buying into, it should not be logged out.
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| Updated: In a chat with ET Now, Ajay Srivastava, Dimensions Consulting Pvt. Ltd. shares his views about consumption oriented companies.
The fact that service tax has been increased from 10% to 12% and excise duty hike has happened from 10% to 12% do you think directly indirectly this will have a impact on consumption demand and now it is time to log out of consumption oriented companies and time to revisit investment oriented stocks?
Yes, you are absolutely correct. But having a caveat is here that do not log out out of the MNC companies. Hindustan Lever has very strong buying into, it should not be logged out. Dabur is running into very small tight frame, Marico is the same story, Godrej Consumer a little bit more international. So one would say log out of the domestic stories but continue very strongly in the MNC stories.
But two things are playing out, one is very high dividend payouts and second is a possibility of a buyout. Therefore what we are looking at is do not log out of the MNC story. Domestic story is is about five companies in all. Hindustan Lever it has already run its cost about 400, it will go to may be 420 or 450, so risk based investment returns may not be commensurate but the smaller consumer companies definitely stay logged in because there is huge dividend payout going to happen there.
The fact that service tax has been increased from 10% to 12% and excise duty hike has happened from 10% to 12% do you think directly indirectly this will have a impact on consumption demand and now it is time to log out of consumption oriented companies and time to revisit investment oriented stocks?
Yes, you are absolutely correct. But having a caveat is here that do not log out out of the MNC companies. Hindustan Lever has very strong buying into, it should not be logged out. Dabur is running into very small tight frame, Marico is the same story, Godrej Consumer a little bit more international. So one would say log out of the domestic stories but continue very strongly in the MNC stories.
But two things are playing out, one is very high dividend payouts and second is a possibility of a buyout. Therefore what we are looking at is do not log out of the MNC story. Domestic story is is about five companies in all. Hindustan Lever it has already run its cost about 400, it will go to may be 420 or 450, so risk based investment returns may not be commensurate but the smaller consumer companies definitely stay logged in because there is huge dividend payout going to happen there.
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