Expect lighting industry to grow at 22%: Mayuresh Joshi

In a chat with ET Now, Mayuresh Joshi – Fund Manager, Angel Broking, shares his views on Jubilant Foodworks and Surya Roshni. Edited Excerpts:

ET Now: Your views on the stocks Jubilant Foodworks and Surya Roshni?

Mayuresh Joshi: If one really has to choose within midcaps, what you are probably liking at the current juncture is a company called Surya Roshni. If the company is basically into the lighting segment, like Bajaj Electrical, it has a 25% market share. The addressable size of the lighting industry itself is expected to grow at 22%. LED is expected to grow at a much faster take a market share of around 58%. In that sense itself we are expecting the top line to grow around 6.5% over the next couple of years. The bottom line growth should have a significant improvement going forward as well. So sizeable order book expected orders to come through thick and fast over the next couple of years and valuations around six times not looking expensive. That can be extremely good value pick even at the current juncture.

ET Now: You are saying valuations are about six times the trailing earnings or six times one year forward?

Mayuresh Joshi: Forward, 6.5 times.

ET Now: 6.5 times, one year forward. I reckon what you think is that it can go up to 10 times one year forward. Is that the kind of targets that you would have in mind?

Mayuresh Joshi: Conservatively we are looking at 8-8.5 times where again if it beats earnings estimates 9.5 times, it is possible over the next couple of years.