NCC, the ace investor’s engineering and construction bet, has delivered 41 per cent return since the Budget. Jhunjhunwala owned 12.84 per cent stake in this firm at the end of December quarter. Phillip Capital said a 191 per cent increase in allocation by the government towards the Jal Shakti Mission over the revised estimates for FY21, a 40 per cent increase in allocation for Smart Cities and AMRUT (over revised estimates), in addition to an increase in allocation for metro and road projects were all positives for NCC.
The company’s order backlog had fallen 11 per cent YoY till the second quarter of FY21, and then jumped on a record Rs 13,700 crore order wins during the third quarter, CLSA noted.
Shares of Karur Vysya Bank, another Jhunjhunwala bet, have climbed 24.5 per cent since the Budget. Analysts noted that Tamil Nadu, where the bank is based, was given special attention in the Budget. ICICI Securities said the state’s credit growth hovered around single digit for almost six years now.
“Upon successful execution, targeted capex could revive growth and help MSMes sustain the current demand,” the brokerage said and projected Karur to be a beneficiary of the move.
Aptech, where Jhunjhunwala owns a substantial 23.84 per cent stake, has rallied 21 per cent since Budget. The Big Bull has filed a consent application with Sebi to settle an alleged insider trading case in the shares of the education company way back in 2016, ET reported last week quoting two people familiar with the development.
Escorts, where the ace investor holds a 4.75 per cent stake, has advanced 16 per cent. Analysts said demand for tractors continued to outpace supply, even as retail sales trailed wholesales slightly over the past couple of months. IDBI Capital said enhanced agriculture credit and doubling of the Micro Irrigation Fund corpus to Rs 10,000 crore in the Budget would boost agricultural activities and lift demand for tractors.
The Federal Bank has climbed 15 per cent. Jhunjhunwala owned 2.4 per cent in this private lender as of December end. The bank’s loan book growth is being led by retail, including agriculture, and is granular in nature. The bank management is expecting to restructure Rs 1,500-1,600 crore loans in FY21, of which it has currently approved Rs 1,000-11,00 crore. The lender is looking to hold a 15-20 per cent provision on the restructuring book. Axis Securities had this stock as one of its top picks in February note, citing strong underwriting standards, changing loan mix and strong retail deposit franchise.
Ion Exchange (India), Firstsource Solutions, Prakash Pipes, Indiabulls Real Estate and GMR Infra are five other Jhunjhunwala stocks that have gained 11-14 per cent since Budget.
Among these, Indiabulls Real Estate has gained on the one-year tax holiday for affordable housing projects and a one-year extension for additional tax rebate on interest paid up to Rs 1.5 lakh on loans to buy affordable housing. Other stocks played catch up with the market momentum. GMR was seen gaining from the infrastructure push.
Publicly available data on Trendlyne showed Jhunjhunwala held more than 1 per cent stake in 39 firms as of December 31, whose value as of Friday stood at Rs 16,775 crore.
