PSU stocks look extremely attractive on hopes of reforms to be brought in by the new govt: Arindham Ghosh

In a chat with ET Now, Arindam Ghosh, CEO, BlackRidge Capital Advisors, shares his views on PSU stocks.

ET Now: I want to discuss at length PSUs in general. Now every tree has a seasonal fruit and for the moment looks like the seasonal fruit is PSU.

Arindham Ghosh: Well that is because of the track record of NDA, what kind of an approach that they have had even at the stage level and to that extent that is one area which is going to see increasingly a lot of action, lot of reforms possibly a whole lot of committees being set up to look to various aspects and try and see how increased or greater level of efficiency can be brought in.

We have already seen the Dr. Nayak Committee report, it remains to be seen how much of that is going to be followed and acted upon but clearly these are steps in the right direction. As an entire pack there are extremely well run companies which have been severely beaten down for a variety of reasons which we are all aware and if we can have initiatives taken which will re-energise and bring in proficient management definitely that entire basket just not the banks would have a strong possibility of getting rerated and most of these stocks are under owned.

They are looking extremely attractive from a valuation perspective and if we just ignore the rotation of money that we have seen into that entire PSU pack and the kind of moves that we have seen but these are just the beginning of what can be significant rerating for the sector going forward. So a lot would depend on what the new government does.

ET Now: Do you have a exposure to PSU stocks in the portfolios you manage and if yes what are the names you own?

Arindham Ghosh: It is hard to talk about specific names but overall this is an under owned sector. It is not that the opportunity has gone by. There is opportunity now at these levels and if we get into some kind of an immediate consolidation phase after tomorrow to start building long positions gradually. A lot will also depend on what measures the new government starts to take in terms of revival of that entire sector but then that is much anticipated and we do expect that the upside from here can be quite significant.