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Divam Sharma smallcase manager and Founder at Green Portfolio

1) Marksans Pharma

Company is into drugs for mainly pain management and cardiovascular treatment. The company is looking to acquire companies to increase its presence in global markets. As the new plant is expected to run at higher utilisation levels, the top line and margins can see significant expansion from the current levels.

2) Sterlite Technologies

One of the biggest beneficiaries in India’s 5G transformation. STL is one of the lowest cost producers of fibre optic cables in India. With a strong order book of INR 11,000 Crores, diversified revenue base, industry tailwinds, company’s execution, STL is one of our 5G theme-oriented picks.

3) Orient Paper and Industries

While increased digitalisation might indicate declining paper industry, for a matter of fact, In FY 22 alone, there was a 4x growth in exports of paper and paperboards. Company has continued its revival in performance in Q4, as envisioned, on the back of Pulp Capacity Enhancement and New Recovery Boiler. The steps taken by the company have helped in increasing realization and reduction in raw material cost. Paper Industry is trading at a PE of 17x whereas Orient Paper is available at PE of 8x.

4) Piramal Pharma

Piramal Pharma is an economically sound business with high barriers to entry. The stock is deeply discounted compared to its peer at current valuations. The company has 3 segments, which are forecasted to witness early double-digit growth over the next 3 years. The innovations management has bought about in regards to its B2C segment will be a pillar for growth.

Our research house is bullish on Piramal Pharma after the demerger considering the growing requirement for development services - especially with complex regulatory processes for newer drugs, high entry barriers, limited competition for the complex hospital generics (provides sustainable growth over the longer term) and the rising contribution from the fast-growing consumer segment.

5) Rain Industries

This is one of our commodities play. Rain industry is one of the world's largest producer of materials that is used as raw materials for aluminium. We expect the demand for aluminium is expected to witness robust growth from here onwards.

Arvind Kothari, smallcase manager & Founder, Niveshaay

The growth engine of India has been firing impressively and it is for the first time a South Asian country is hosting such a powerful group of world leaders. The G20 summit happening in India is a testimony to global stability India has despite global macroeconomic headwinds over the last couple of years.

Under the Indian Presidency, the G20 in 2023 will focus on the theme, ‘One Earth, One Family, One Future’. The discussions will hover around range of issues with environmental sustainability and impacts of climate change being the priority. Companies like Shivalik Bimetal, Waaree Energies who are globally competitive are on their journey to benefit significantly from this transition. The discussions will also be around the lasting social and economic impact of major global events in past couple of years like covid, geopolitical tensions and wars etc. which are still felt deeply. With domestic manpower, availability of certain raw materials, resources and minerals, India can achieve a good growth in certain sectors where it has competitive advantage and provide solutions to the world for a better future. We believe companies like Usha Martin, Gokaldas Exports and Centum Electronics showcase India’s rising prowess across sectors like Capital goods, Textiles and Electronics manufacturing.

1. Shivalik Bimetal Controls Ltd.

The company is a prominent supplier of critical components for Electric Vehicles, Energy Storage Devices, Switchgear, Electrical Appliances, and Smart Meters. It specializes in manufacturing shunt resistors, which are electrical components responsible for regulating the flow of electrical current within a circuit. There are only 4-5 low TCF Shunt Resistors manufacturers across the world with Shivalik being one of them. The company currently has around 10% market share in Shunts and around 16% market share in Bi-metallic strips. The manufacturing of these resistors necessitates expertise in specialized welding techniques. Due to its long track record of operations the company has a strong relation with its clients and boasts strong and credible client base comprising of major domestic players as well as international players. 

2. Waaree Energies Ltd. (Unlisted)

India has a target to have a 500 GW of installed capacity of renewable energy by 2030. Out of this, 280 GW was expected to come from solar power. The current solar installation capacity is around 60 GW in India. With a current capacity of 11 GW, Waaree energies ltd. is India’s largest solar PV module manufacturing company. Considering it had only 2GW capacity in 2021 i.e., 2 years back, it has exponentially increased its capacity because of rising demand and healthy order book. Majority of this order book is from USA which showcases its global competitive strength across Chinese peers.

The company is now vertical integrating into cell manufacturing which will further expand operating margins of the business by 5%. It is also expected to further increase the module capacity to 16 GW by 2025. Overall, we believe the company is going to benefit from the growing global solar industry.

3. Usha Martin Ltd.:

Usha Martin is market leader in steel wire ropes with 60% market share in India. Steel sourcing and Power cost is comparatively cheaper in India as compared to China, Europe which makes India competitive. It operates in a strong entry barrier market as product approval isn’t easy, cost of breakdown is very high and safety is of utmost importance. With already a presence in international markets, the company is keen to expand in other regions like the US, Canada, South America and Germany. EBITDA margin expansion due to change in product mix and presence in international markets make this as a beneficiary.

Fundamentally, India is at a very good stage where corporates have healthy balance sheet while the government has implemented effective policies to stimulate the capex cycle and advance infrastructure and energy transition. Additionally, private capex has surged, leading to strong order books for capital goods companies.

4. Gokaldas Exports Ltd.:

In the textile value chain, the apparel side of the business has benefitted significantly from China plus one and the supply side consolidation trend during the pandemic. India becomes a preferred destination because of its presence in the entire cotton value chain which reduces lead time, increases speed and pre-requisite for apparel brands. During the pandemic, India got many such opportunities and a few companies like Gokaldas Exports grabbed these and found a pivotal place in the global value chain. With the government focusing on making India the textile export hub, this company would participate in the global market opportunity that comes to India.

5. Centum Electronics Ltd.

Centum is one of the leading players in the industry with presence in Aerospace, Defence, Space, Transportations, Healthcare, etc. with 72% of their revenue generated from exports to Europe, UK, North America, etc with global customers like Thales, Rafael, Alstom, GE, ABB, etc. They have experienced significant increase in order book and are focusing on further improving on margins by increasing operational efficiency. They have observed robust growth in new multinational customers from emerging sectors like clean energy, electric vehicles, and hydrogen fuel cells.

We believe the above companies are true beneficiary of India's rising global prowess.

From Sonam Srivastava, smallcase manager and founder of Wright Research

1) Tata Motors:

As India pushes for electric vehicles, Tata Motors, with its growing EV segment, stands out. Their global presence, especially with the Jaguar Land Rover brand, showcases India's capability in high-end manufacturing and innovation.

2 & 3) Infosys or TCS (Tata Consultancy Services):

The IT sector has been India's flagship in showcasing its global prowess. Companies like Infosys and TCS reflect India's strength in digital solutions, IT services, and software development, aligning with the digital discussions of the G20.

4) JSW Steel:

With the focus on green steel and decarbonization, JSW Steel, one of India's leading steel producers, represents the country's metals sector's sustainable approach. Their global acquisitions and ventures also signify India's expanding footprint in the global metals market.

5) Dr. Reddy's Laboratories:

Representing the pharmaceutical and healthcare sector, Dr. Reddy's embodies India's role as the 'pharmacy of the world'. Especially in the context of global health discussions and the recent pandemic, India's pharmaceutical industry has played a crucial role in providing affordable medicines and vaccines to various countries. Dr. Reddy's, with its extensive global presence and diverse portfolio, showcases this strength.

From Ashish Kumar, smallcase manager and founder of Stoxbazar

India's G20 presidency is expected to have a positive impact on several key sectors of the Indian economy. Here's a summary of the sectors and some potential beneficiaries:

1) Oil & Gas - Reliance

Reliance Industries Ltd (RIL) has announced a massive investment in new energy, emphasizing green and sustainable practices.

Green energy transition and discussions at the G20 are expected to benefit India's green energy initiatives and companies involved in clean energy production.

Stocks: Companies like Reliance Industries Ltd (RIL) with a focus on green energy and sustainability may see benefits.              

2) Utilities - Tata Power

India aims to have 500 GW of non-fossil fuel-based capacity by 2030, with an emphasis on green grids and renewable energy.

India co-founded the International Solar Alliance with France, emphasizing green finance and technology.

Stocks: Utility companies like Tata Power may benefit from investments in renewable energy infrastructure.

3) Automobiles - M&M

India is positioning itself as a hub for fast electric chargers, EV batteries, and battery recycling.

Aggressive targets have been set for EV adoption in various vehicle segments.

Stocks: Companies in the electric vehicle ecosystem, like Tata Motors, Mahindra & Mahindra, and battery manufacturers, may benefit.

4) Real Estate - G R Infraprojects Ltd

Foreign investment and NRI interest are expected to increase during India's G20 presidency.

Economic uptrends and sustainable development initiatives are also anticipated.

Stocks: Real estate developers and companies may see increased investments.

5) Space - Hindustan Aeronautics

India's space sector is growing rapidly, with a significant number of private space companies.

The sector is attracting investor interest and foreign investment.

Stocks: While specific stock recommendations in the space sector are not mentioned in the article, investing in companies involved in India's growing space industry may present opportunities.

Metals: India is expected to push for decarbonization and green steel initiatives as the G20 President.

Emphasis on green steel and long-term sustainability goals.

Stocks: Indian steel producers like JSW Group may benefit from green steel initiatives.

Cement: India's infrastructure growth is driving demand for cement.

Reduced trade barriers and sustainable practices are expected to benefit the cement industry.

Stocks: Cement companies like Dalmia Cement Bharat may see opportunities for growth.

Aviation: India's aviation sector is experiencing impressive growth.

The sector expects further expansion as India becomes the world's third-largest economy.

Stocks: Indian airlines like IndiGo and Air India may benefit from increased demand and market development.

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