LG Electronics, Hyundai Motor: What SMIFS' Sharad Avasthi says on these two stocks

Sharad Avasthi, Head of Research (PCG) at SMIFS, on Wednesday shared his views on Hyundai Motor India Ltd and newly listed LG Electronics India Ltd. Speaking to Business Today, Avasthi said LG Electronics India's market debut was impressive and reflected sound pricing. "It was an excellent listing. For a change, one of the larger issues was not priced to perfection, leaving a lot on the table," he said.

However, the market expert cautioned that at current valuations, investors may find it challenging to generate strong returns in the near term. "At these valuations, it would be hard to get money out of it over the next one and a half to two years," Avasthi noted. He explained that while certain segments, like air conditioners, may not have performed well, other consumer durable categories have shown robust growth. "I'm very bullish on the long-term prospects. If you're a long-term investor, you can continue to hold. But if you're looking for short-term gains, it's better to book profits because there may not be much upside over the next year or so," he added.

Turning to Hyundai Motor India, Avasthi highlighted that the company has seen steady upgrades in its forward earnings estimates over the past several months. "Over the last six to seven months, there has been a earnings upgrade of about 5-7 per cent. The company's legacy models continue to perform well and Hyundai remains a strong brand in the Indian market," he said.

However, the market specialist advised investors to be patient amid rising competition in the automobile sector. "It's better to wait and watch. If some models perform exceptionally well, that could be the right time to start building positions again," Avasthi said.

He suggested that investors consider re-entering the stock on price corrections. "Around Rs 2,200–2,300 would be an attractive level to look at Hyundai again. Buying on dips could offer a better entry point," he concluded.