Cement to be under pressure; PNB, IOB, Corp Bank have potential: HSBC InvestDirect

IT would probably be in focus naturally for the kind of the expectations from Infosys. But, having looked that how the markets have behaved in the last few sessions wherein every dip has been bought into and we are just on the eve of earnings season, how does it look like?
We think Infosys could have upside potential from current level, ahead of the result it will make sense to buy Infosys. Also, there could be lot of mid-cap stocks in IT spaces, which are likely to see buying interest, Infosys in particular. We are also positive on NIIT Ltd. and HCL Infosystems.

A lot of stocks in yesterday���s trade out of the blue came up and showed some spectacular price movements, Reliance Infra for one, Jet Airways in the mid-cap space as well. Anything that catches the eye per se?
Technically we are positive on Tata Steel and JSW Steel, both could have upside potential as something like 10-15% from current level. We are also positive on Mahindra & Mahindra and Kotak Bank.

On the commodity pack now. Prism Cement numbers, a small company but if there are any indication of how the quarter could pan out, quarter and quarter they were really disappointing and of course news surrounding Grasim and Ultratech as well, two of the largest companies. How do you play the cement pack?
See, there is a fear that already the cement prices are down in lot of pockets and further pressure on the cement prices as the fresh capacity goes on stream is not ruled out. As a result, we believe the cement overall could remain under pressure. Yes, there could be some stock specific movement, may be Shree Cement can be bought on any declines with a medium to long-term perspective.

Other than that, there could be lot of stocks in the mid-cap space, particularly stocks like Heidelberg Cement. In any weakness, you could be looking at Rain Commodities, which is not a pure cement play. There could be further upside, not ruled out in Orient Papers as well.

We are speaking about the possibility of rate hikes also coming in, anything that you like and do you think as a space, PSU banking looks interesting?
Not from a trading perspective, but, if you are taking a positional bid, there could be some stocks, which could offer upside potential, Corporation Bank being one, PNB could be looked at, also IOB is seeing a lot of accumulation taking place for quite sometime, it has not participated, it could offer upside potential with a medium-term perspective.

How about the auto space?
We are positive on Swaraj Engine in particular, which is an ancillary supplier to Swaraj Tractors that is now a division of Mahindra & Mahindra. We are also positive on Rico Auto as well as Subros Auto.