Which are JPMorgan’s Preferred Picks in Indian Capital Goods?

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JPMorgan Highlights Opportunities in Capital Goods Amid Capex Slowdown

About the Sector

India's capital goods sector is experiencing a moderate slowdown in capex growth, with an expected medium-term expansion of around 10-11%. Despite this deceleration, stock prices already reflect much of the slowdown, creating selective opportunities for investors in companies with strong growth visibility.

Investment Preferences: JPMorgan advises focusing on companies with consistent growth and visibility. Preferred picks include L&T, CG Power, Cummins, and Thermax for potential healthy earnings growth.
Trading Multiples: Valuations are now more attractive, providing a window for strategic investment in well-performing capital goods companies amid moderate capex expansion.
Brokerage Recommendations:
  • Thermax - Initiate Overweight | TP: ₹3,869
  • Cummins - Initiate Overweight | TP: ₹4,649
  • CG Power - Initiate Overweight | TP: ₹840
  • Praj Industries - Initiate Neutral | TP: ₹403
  • ABB - Initiate Neutral | TP: ₹5,639
  • Siemens - Initiate Underweight | TP: ₹2,795
  • BHEL - Initiate Underweight | TP: ₹185

Investor Takeaway

Investors can consider selective exposure in well-performing capital goods companies as moderate capex growth presents opportunities for earnings expansion. Focus on visibility and strong fundamentals to navigate this cyclical environment.

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SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.

JPMorgan, Capital Goods, India Capex, L&T, CG Power, Cummins, Thermax, ABB, Siemens, BHEL, Indian-Share-Tips.com

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