Select stocks in the defence sector look more investable as compared with other companies, according to Gurmeet Chadha.
The current defence budget, structured pattern in the sector along with indigenisation and import restrictions have made some pockets in the sector more safer to invest than others, Chadha, managing partner and chief information officer at Complete Circle PMS Pvt., told NDTV Profit's Sajeet Manghat on The Portfolio Manager show.
Though the budget allocation to the defence sector has increased over the years, people should still be cautious before investing in it, he said.
“Drones, hand grenades and Pinaka rockets have a shorter order and execution period—around two to three years—which make them preferred pockets to invest in,” he said.
Complete Circle has started to increasingly include the IT sector in its portfolio after the prices became reasonable, Chadha said. Tata Technologies Ltd. is his top pick and he expects it to become a multibagger stock in the next 10 years.
Chadha said that the 12% allocated to the IT sector includes multiple stocks. While TCS and HCL Technologies Ltd. were included last year, KPIT Technologies Ltd. and Tata Technologies Ltd. are currently part of the portfolio, he said.
In the consumer and real estate sector, Chadha mentioned that they are focused more on premium companies with double-digit growth and higher growth possibilities. He recommends Tata Consumer Products Ltd. and DLF Ltd. as good bets.
According to Chadha, in the consumption sector, his firm is focusing on "anything which is at the upper end", or with an aspirational value and might interest the upper middle class of India.
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