Good returns expected from capital goods sector in mid-2012: Vikas Khemani, Edelweiss Securities

In a chat with ET Now, Vikas Khemani, President and Head-Institutional Equities, Edelweiss Securities, shares his views on capital goods stocks.

ET Now: What wis your call on the capital goods stocks?

Vikas Khemani: Capital goods sector has been beaten down significantly. L&T has probably somewhere around gone to June 2009 levels and investment activity has considerably slowed down post 2008. So, there is a case which is being built around the capital goods sector.

Given the last month’s IIP number, the confidence has again shaken a bit and that is the reason we have seen this is a sell-down sector. The risk reward for investing into high quality capital goods sector companies has been falling into place. Somewhere in the middle of next year, we will get good returns from the capital goods sector.