Capital goods stocks' prospects look better: Pankaj Pandey, ICICIdirect.com

In a chat with ET Now, Pankaj Pandey, HoR, ICICIdirect.com, shares his views on the capital goods segment.

ET Now: In the capital goods segment, companies like Voltas and Crompton were expected to do well. What is the house call here?

Pankaj Pandey: As of now, we are not seeing much of an improvement in earnings but from next year's perspective, the sector looks quite promising. I say that because if you look at BHEL, they were getting orders to the tune of about odd 60000 crores three or four years back. Now the order inflow is half of those levels.

EBITDA margins were 20 per cent, now it is about 10 per cent. So we would like to believe that there would be an improvement in the fortunes of the entire sector and the companies under it and probably not now but from next year. As of now, we have a positive stance on L&T coupled with Greaves Cotton. As things improve, the stocks also would start performing better.