Group stocks like Adani, Mahindra stood out this year; IT, real estate top drags: Udayan Mukherjee

In an exclusive show on 'Muhurat' trading this Diwali, Udayan Mukherjee, Global Business Editor, Business Today TV, talked about the stocks and sectors which have overperformed and underperformed amid the gloomy outlook in the global market space.

Given the weak global picture due to the ongoing Russia-Ukraine war, surging inflation and a series of interest rate hikes from the central banks, Indian equity benchmarks have remained resilient in comparison with their peers.

"In the stock market, we keep talking about wealth creation but people forget that the preservation of wealth is as important in that journey. This year what the Indian market has done is that it helped you (investors) preserve your wealth in a very difficult circumstance. We will all say that it's a flat year for the markets and people have not made a lot of money. But the fact that in this global situation that you have not lost money is actually worth many years of making money in the markets. So, I take it as a great year gone by," he said.

"This has been a year of the underdog. Anti-ESG (Environmental, social, and governance) stocks -- Coal India and cigarette maker ITC -- which were languishing for years, they topped the charts this year from last Diwali to this Diwali. So, these underdogs have come back in a major way," Mukherjee added.

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He also pointed out that a couple of groups have come to the fore.

"Adani (Group) is the easy one to talk about because all of its stocks have been two-bagger and three-bagger. You can't deny that this has been the year Adani has put a stamp on the Indian stock market in a major way. Time will tell whether they can hold up this kind of performance or live up to this kind of stock price performance," he said.

Shares of billionaire Gautam Adani-led group delivered robust returns in Samvat 2078, with four of its stocks rallying more than 100 per cent.

"The other group is the Mahindra Group. As a stock, M&M was stuck at Rs 800 perennially but this year that jump in a flat market makes it stand out as a very interesting kind of stock. The capital raising on the electric vehicle (EV) front flipped a switch in the mind of investors," Mukherjee stated.

M&M stock has surged more than 50 per cent so far this year.

He further opined that this has been a year where more than sectors, individual stocks within sectors have done well.

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"In the case of pharmaceuticals, where on one hand you see stocks Cipla and Sun (Pharma) do so well and on the other hand you look at Lupin, Natco and Ipca (Labs) which have languished. In the auto sector, it is the same thing. Apart from M&M, TVS (Motors) has been a stand-out performer. But Tata Motors and Bajaj Auto have not done that well. It is like few stocks in some sectors have done well and it has not been a top-down sectoral kind of a year," he said.
Tata Motors stock has dropped more than 18 per cent on a year-to-date (YTD) basis. Bajaj Auto has climbed over 11 per cent. However, the bikemaker has slipped more than 11 per cent from its September high.

From a winning basket, he said, a couple of group stocks (like Adani and Mahindra), some of the underdogs, a lot of PSUs (public sector units) which were forgotten, and a lot of intra-sector calls in individuals have performed.

In terms of losers, Mukherjee said, IT (information technology) and real estate have been two of the biggest disappointments for the year.

Meanwhile, Indian equity benchmarks failed to keep the momentum going in the previous session after starting Samvat 2079 -- Hindu calendar year -- on a high note. The domestic indices were closed on Wednesday on account of Diwali Balipratipada.