NSE IPO, Bata revival and Nykaa growth: Gaurang Shah's market playbook

Synopsis

Geojit Investments' Gaurang Shah sees selective opportunities in India's equity markets despite global uncertainties. He highlights potential for Bata India under new leadership, Nykaa's AI-driven growth, and favors defence, asset management, and power sectors. The upcoming NSE IPO is also viewed as a significant positive for the capital market ecosystem.

India's equity markets continue to present selective opportunities despite global uncertainties, according to Gaurang Shah of Geojit Investments. Speaking to ET Now, Shah shared his views on Bata India's leadership transition, Nykaa's growth strategy, his preferred investment themes, and the much-awaited NSE IPO.

Fresh Leadership Could Revive Bata

Bata India has struggled to reward shareholders over the past five years despite launching new products, consolidating stores, and expanding across customer segments. Shah believes the company now needs a fresh strategic direction under its new leadership.

He also noted that the domestic footwear industry stands to benefit from government measures aimed at curbing cheap imports from China and Bangladesh.

"We do have a positive coverage on Bata India from a long-term fundamental point of view. We feel it is time to bring in new strategies and fresh thinking... With this new leadership, we should see a significant amount of change coming in."

Nykaa's AI Push Strengthens Growth Story

Shah maintained a positive outlook on Nykaa after the company outlined its FY30 vision and announced AI-driven initiatives. However, he advised investors not to chase the recent rally and instead wait for better buying opportunities.

He also highlighted that innovation remains essential in the highly competitive e-commerce space.

"If you already have investments, you can continue to hold them. If you do not own the stock, do not rush into it. Let the stock correct a little, and then you can gradually accumulate."

Defence, Asset Management and Power Remain Top Bets
Looking ahead, Shah identified defence, asset management and power as his preferred sectors over the next year. His top stock picks include Bharat Electronics, Nippon Life India Asset Management and Torrent Power.

According to him, these sectors remain relatively insulated from global uncertainties and offer strong long-term growth potential.

"These three sectors are relatively insulated from external global shocks, and there is significant growth potential for both the sectors and these companies."

NSE IPO Seen as a Big Positive
Shah described the proposed NSE IPO as one of the biggest developments for India's capital markets in recent years. While he refrained from commenting on valuations until Geojit's research is complete, he remains optimistic about the broader capital market ecosystem.

He believes exchanges, depositories, registrars and asset managers are all well positioned to benefit as India's equity markets continue to expand.

"If Indian stock markets continue to grow at 12% to 15% annually over the next three to five years, fundamentally strong capital market-related companies should continue to perform well."

Long-Term Investing Still the Best Strategy
Across sectors, Shah's is of the view that investors should focus on fundamentally strong businesses with sustainable earnings rather than short-term market fluctuations. While leadership changes and new growth initiatives can create opportunities, disciplined long-term investing remains the key to generating wealth.

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