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For those who
want to bet on a little higher risk, cyclicals would probably generate faster
returns. However, I think the consumption space and FMCG
in particular, could generate a steady return and that is why some of the
long-term investors like them.
There are a few
companies which remain in the merit list for us. One among them is a company
called Infibeam. It is a company which is in the fin tech space and it is
emerging stronger. They are facing a certain amount of challenges as far as the
market perception is concerned, but in my view, given the track record that
they have demonstrated and executed, I would think that this company has a relatively
strong proposition to provide a multiplier set of returns. In the Indian
market, analysts and investors probably understand a little less about the fin tech space. With some degree of understanding, these companies could command
relatively better valuations. Along with that, there are opportunities in the
mid tier IT companies which are basically aligning themselves largely with the
cloud computing and digital space. Here, one could see a CAGR of around 25-30%
over the next 4-5 years. There are select companies in the portfolio where we
feel that opportunity is there and risk is worth taken.
On one hand, there is content and on the other hand, there is distribution.
If you can plug your content to the distribution well, that is where the larger
growth is going to be. The growth in the market cap of some of the companies in
recent times can be linked to the OTT platforms which have generated a
significant amount of wealth for these companies who are willing to expand
globally. In India, most of the companies have got strong content -- be it the Zee group &
Network 18 Group they are basically registering higher amounts
of returns on the OTT side. That is an area where we think one can think of
creating wealth.