Saurabh Mukherjea's Top Stocks: Divi's Labs, Eicher Motors, Dixon Tech And These Largecaps Make The Cut

Investors need to keep a close eye on developments across the globe and market moves to identify the bets that deliver returns amid volatility. Saurabh Mukherjea, chief investment officer and founder of Marcellus Investment Managers, has his calls cut out. In the large cap category, Mukherjea is bullish on banks, PSBs, chemicals and electronics.

"If one wants to invest in Indian markets, choose large cap quality stocks which will give decent returns in next five years. If the currency depreciates, the Indian IT space will benefit from that. Defence sector may not benefit a lot from trade deal," he told NDTV Profit on Monday.

Sector specific stocks that make the cut include Divi's Laboratories Ltd., Syrma SGS Technologies Ltd., Eicher Motors Ltd., Dixon Technologies Ltd. and Sona BLW.

Divi's Labs has been a big bet for the expert as it is a key beneficiary for 'China+1'. The company has a chain of suppliers as well who grow with the boom of the company, that investors can watch for, according to him.

This scrip has delivered returns worth 13.09% on a year-to-date basis while the last 12 months have seen the stock rise 48.97%. Divi's Labs is trading 0.12% lower at Rs 6,898.5 at of 12:55 p.m., compared to a 0.07% decline in the benchmark Nifty 50.

"Dixon has clearly been an investment we missed out on, and a firm like Dixon could do well out of the FTA," he said.

Batlivala & Karani Securities has initiated coverage on the stock with a 'buy' rating and a target price of Rs 18,946. The brokerage is expecting the company to scale new highs.

Dixon Tech is uniquely positioned to benefit from the accelerating shift towards electronic outsourcing, Mukherjea said. The analyst sees revenue and profit growth of 42% and 69%, respectively over FY25-27.

Customer addition, along with increasing market share from existing customers is key to growth for this player. Component manufacturing is expected to provide the next leg of growth. While lighting products is the new product development on the cards.

Eicher Motors is also a large cap stock that makes it to Mukherjea's top picks. The scrip, currently trading 1% higher at Rs 5,685 apiece on the NSE, compares to the 0.11% decline in the benchmark index Nifty 50 as if 1:04 p.m.

The counter has risen 17.66% on a year to date basis, while it has seen a 19.73% rise in the last 12 months.

Despite being bullish on several Nifty 50 stocks, the founder of Marcellus Investment warned that the the Indian market is "expensive" and the Indian economy is slowing down. Explaining why investors should diversify away from India, Mukherjea states that due to rich valuations, earnings slowdown, the risks are elevated in the domestic space.