Play the Euphoria Smartly

‘It’s all about money, honey’ is a popular phrase. This applies to stockmarkets or for that matter any investment, be it shares, property, gold. As expected the grand election victory of Modi has led to an Euphoria in the stock markets.

But, we are far away from the peaks that investments can scale. If you are a smart investor, you will not pick obvious stocks which have already run-up. Cyclicals for example like banks can make money for you, but the obvious ones like ICICI, Axis, HDFC, Indusind Bank and Yes Bank have already run up by 30% or more in the last couple of weeks and in most of these private banks the FII investment cap has been reached.

My pick would be Fed Bank which is a midcap bank based out of Kerala. Although this one too has run up from Rs.94 to Rs.124 it is likely to cross Rs.200 at a very fast pace. It has a lot going for it. Mainly the Forex gains in this quarter alone will significantly increase its profile because it receives a lot of Forex from Kerala expats in the Gulf.

Besides it will be managing the automated ticket sales of the Bangalore Metro. Another source of significant profits.

Cox and Kings is another favorite and still largely under owned stock. Currently trading at Rs.177 it is likely to cross Rs.250 by end of June or go even to Rs.300. It has just tied with the US to give US visas. The visa fee for US is Rs.9000 out of which it will get Rs.1500. This alone will double its profits. Besides Modi government will give a big boost to tourism.

That’s not all - Cox & Kings has a 100% owned subsidiary called Prometheon in UK, which is set for an IPO on the London stock exchange in June. This will raise Rs.2,000 to 2,500 crores, much of which will come to Cox & Kings. Lastly it has a tie-up in UK and Australia for 1500 hotel rooms. Not much of these facts are known. So it’s a good buy even now. Both Fed Bank and Cox & Kings are set to appreciate by 100% in a matter of 3 to 6 months.