Positive on Kalpataru from a 6-9 month perspective: Neeraj Deewan

In a chat with ET Now, Neeraj Deewan, Director, Quantum Securities, shares his view on engineering stocks.

ET Now: Any of the engineering names that you would like to recommend? Which engineering stocks would you like to play with from a six-month perspective. I am asking this because that quarterly numbers will start showing up only after the Q3 or Q4?

Neeraj Deewan: We keep on meeting engineering companies. We do have a coverage on select companies from the engineering sector. Kalpataru is one of them.

The transmission space is one where you have seen a regular improvement in order inflows. We are seeing a lot of order inflows coming to companies such as KEC International. We have a better sense on what is happening in Kalpataru as we track this particular stock. We also track Thermax, but the stock is not cheap at present valuations.

If one has a longer-term perspective in mind, then Thermax can report a significant improvement in earnings in 2018. But, a smaller company like Kalpataru can offer you better returns over the next 9 -12 months because it is trading at reasonable valuations. There is also some infrastructure exposure there with JMC being part of that company. So Kalpataru is one company we are bullish on.