The logistics sector can keep delivering double-digit growth given the business opportunities and presence of a large unorganized segment, says Pankaj Pandey, head of research at ICICIdirect.
This is a huge industry, worth Rs 9.5 lakh crore, and you have various segments which are expected to sort of keep delivering double-digit kind of growth, Pandey told ET Now.
While the business prospects are strong, some stocks such as Blue Dart Express are trading at high valuations, Pandey said, highlighting it as a reason for not tweaking the price target.
While Blue Dart has taken price hikes and will be able to maintain its margins, valuations are not comforting, said Pandey, thus not recommending to buy the stock at current levels.
Besides the logistics sector, Pandey is also bullish on the automobile ancillary industry given the demand prospects for both passenger vehicles and commercial vehicles.
Mahindra CIE Automotive is one of the companies Pandey is bullish on as its planned capital investments in the domestic subsidiary will drive margin growth.
Automotive Axles also looks attractive and can be a good play in the CV space, believes Pandey. “I think auto as an overall segment has a lot more room to perform from current levels,” he said.
