Buy insurance cos on dips; TTK Prestige great business to own for long-term: Prakash Diwan

Market expert Prakash Diwan on Tuesday said that investors should use dips to buy insurance stocks while also adding that pressure-cooker maker TTK Prestige is a good long-term bet.

“I would wait for markets to give that opportunity – a dip to buy into these stocks but it is always good to have a combination of SBI Life Insurance Company, HDFC Life Insurance and Max Life Insurance,” Diwan told CNBC-TV18.

On various other stocks like Bharat Petroleum Corporation Ltd (BPCL), IT, insurance companies, TTK Prestige, United Phosphorous Ltd (UPL) and Arvind Fashions, Diwan said, “TTK Prestige is a wonderful business to own especially for the long-term. You have to have it in the portfolio if you are looking at something which is more robust and doesn’t keep on wavering along with the market movement, the underlying business is always going to be robust as long as you have the patience to hold it for the long-term.”

Diwan also said that price discoveries have been pretty robust on BPCL. Eventual divestment probably keeps the stock very strong. He wouldn’t be surprised to see Rs 475-485 being tested very soon on the stock.

On IT shares, he said, “The larger players will probably see ETF outflows also at some point in time because they have attracted that in the last 12 months but I would believe the mid-sized IT players have far better opportunities that are still to be captured.”

On UPL, Diwan said the stock is in a space where it would continue to grow with this momentum.

“There is enough appetite because the representation in the Nifty on this side is also very limited. So this will continue to fetch a lot of premium. I don’t see any reason why this stock would correct in a hurry.”

Arvind Fashions with all its power brands is doing well, along with strong exports.

“There is this whole thing about Arvind Fashions not being in the right space or probably be too dependent on just one segment of retail. However, that is not the case. They have restructured themselves, there have been rights issue, the promoters have an extremely high level of confidence by subscribing more to it. it is in the right spot, not very expensive at Rs 2,000 crore valuation, could probably give you that kind of a rerating move very soon,” said Diwan.