EPC of Mahindra group has promise: Parag Thakkar, HDFC Securities

Parag Thakkar, Head-Institutional Sales, HDFC Securities, says bullish from longer term perspective in sectors like roads, irrigation and agri productivity


ET Now: This earning season, we are seeing good companies getting rewarded in small measures and bad companies are getting punished severely. Case in point, Crompton, Dish, etc. What has stood out in terms of good numbers for you over the last three or four days or the last two weeks? Any company that came out with numbers which made you stand up and take notice?

Parag Thakkar: On the largecap side, Power Grid reported good numbers as expected. Infosys started on a very strong note. Reliance came out with very good numbers. Grasim on the standalone side, VSF business did very well. On the disappointment side, I would say Maruti disappointed. Crompton Greaves disappointed.

ET Now: But what about the broader market space, anything that stood out?
Parag Thakkar: In broader market space, I am very bullish from a longer term perspective in sectors like roads, irrigation and agri productivity. There, one small company reported very good numbers. Of course, we do not have that under over coverage so I cannot give a target price but a broader thesis. It is a Mahindra Group company with a very small market cap of Rs 400 crore. It is a debt-free company in micro irrigation space.

ET Now: EPC.

Parag Thakkar: So they reported excellent numbers in the sense that YoY topline growth was 35 per cent. PAT and EBITDA grew by 4x. There are things that are looking good. Remember out of the total arable land in India, only 9 per cent is trip irrigated and now we have a huge water scarcity. With two years of drought, government will have to focus on this space to improve productivity and Andhra Pradesh and Tamil Nadu have started releasing subsidies. Since this business generally moves on subsidy, that was one result which I really took note of because that is where I feel that company is at inflexion point.