Stock sectors to bet on this year

By Rahul Oberoi

Investors can expect the 2012 stock market rally to continue well into 2013. The Bombay Stock Exchange (BSE) Sensex was up 24 per cent till December 14, 2012 from the start of the year. There is widespread optimism that the proindustry decisions by the government of the last few months and a lowering of interest rates - which is widely expected - accompanied by an economic recovery, however small, will work their magic on equity markets in the next few quarters. An ICICI Securities survey in December 2012 found that 60 per cent fund managers expected the market to be up 15 to 20 per cent after a year. In August 2012, only eight per cent were bullish.

In 2012, till December 14, foreign institutional investors (FIIs) injected Rs 1.17 trillion (a trillion is one lakh crore) into Indian equities. In 2011, they had been net sellers of Rs 2,714 crore. "We expect FII inflows to be fairly healthy in the coming year (2013) due to India's relatively better growth," says Gaurav Dua, Head of Research, Sharekhan.
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Sunrise areas such as fast food chains and health and fitness hold out promise for the long term"

V.K. Vijaykumar, Investment Strategist, Geojit BNP Paribas
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Market analysts are especially positive on retail, media and aviation - the sectors in which the government allowed more foreign direct investment (FDI) in September. Some are also positive on consumer discretionary companies, which they say may gain from rising incomes. "With the opening up of the multi-brand retail to foreign capital, the companies will get high investor interest in the coming year," says Pankaj Pandey, Head of Research, ICICI Securities. In 2012, till November 30, the Store One Retail India stock had risen 461 per cent to Rs 50, followed by Pantaloon Retail by 65.5 per cent to Rs 210 and Shoppers Stop by 65 per cent to Rs 428.

In the media, digitisation will provide opportunities to companies in film, cable distribution and broadcast segments. Cable TV distribution in Delhi, Mumbai, Kolkata and Chennai went digital on October 31, 2012. In just one month, the shares of Sun TV, Hathway Cable & Datacom, and Zee Entertainment Enterprises rose 24 per cent to Rs 408, 16 per cent to Rs 271 and three per cent to Rs 195, respectively.

Digitisation will help companies stabilise revenues by checking under-reporting of subscriber numbers by cable operators. "Opportunities from digitisation will exceed most estimates," says David Pezarkar, Head, Equity, Daiwa AMC. Consumer sectors, on the other hand, will gain from a rise in the country's per capita income, which has been growing at 12 per cent a year for the past five years. "Education and leisure can do well in 2013. However, retail investors should wait for clarity on the winners as revenue will shift from unorganised to organised players.

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Source: http://news.yahoo.com/stock-sectors-to-bet-on-this-year-050813058.html

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