Capital Goods
Stocks Outlook for the week – 20 to 24.07.2015
(Seen in range next week and
Apr-Jun earnings eyed)
( www.rupeedesk.in )
Stocks of capital goods companies are seen trading in a range next
week as investors are cautious
ahead of what could be another disappointing earnings season. Alstom
India will detail its earnings
on Wednesday while ABB India Ltd and Crompton Greaves will report
their earnings on Jul 24.
We believe that Crompton Greaves can meaningfully increase its
profitability over next two years
on back of 1) cost rationalization in key European/US subsidiaries and
2) improvement in distribution transformers in Europe.
We are also positive on Bharat Heavy Electricals as they see the
company emerging as the biggest
beneficiary of the demand revival from power sector. BHEL as the
biggest beneficiary of a demand
revival, given the weakened competition, cost advantage and high
degree of localised
manufacturing.