Sell Voltas on rebound, hold Lupin for relief rally, says market expert

Investors stuck with losses in Voltas Ltd and Lupin may need to take sharply different calls from here. On Business Today’s Daily Calls, market expert Rachit Khandelwal, Head of Research, BNK Capital Group advised viewers to consider exiting Voltas on any recovery, while maintaining a constructive stance on Lupin despite recent underperformance.

The divergence in his view underscores a broader market reality: Sectoral headwinds are weighing unevenly across portfolios, and not every beaten-down stock offers the same recovery potential.

Voltas faces pressure despite festive season hopes

Khandelwal said Voltas continues to struggle under margin and demand pressures in the consumer durables space. He pointed to elevated metal prices and weak visibility on a meaningful recovery, even as the market heads into what is typically a stronger consumption quarter.

“We are not seeing much of a respite coming in in Voltas,” he said, adding that festive demand may not be enough to offset the stress created by higher input costs and tighter financial conditions. In his view, the stock is unlikely to deliver the kind of third-quarter upside investors usually expect from the segment.

Rate sensitivity clouds consumer durable outlook

A key concern, according to Khandelwal, is liquidity tightening and the pressure of higher interest rates on rate-sensitive sectors. That, combined with pricing issues, reduces the chances of a sharp rerating in Voltas in the near term.

He advised investors to “try and exit” the stock if they get an opportunity in the Rs 1,160 to Rs 1,240 range. His assessment was blunt: there is “no good reason for us to believe that it might even cross these levels” decisively from here.

Lupin still has room for a rebound

On Lupin, however, Khandelwal struck a more optimistic note. While the stock has caused disappointment for investors who entered at higher levels, he said the underlying case for the pharma major remains intact and does not warrant panic.

“Lupin is a good stock,” he said, though he stopped short of recommending averaging at current levels because the gap between the buy price and current market price is not large enough to justify that strategy.

What investors should watch next

For Lupin, Khandelwal said investors should stay patient and watch for a breakout above the Rs 2,190 to Rs 2,230 band. Once that happens, he expects “a decent relief rally” to kick in.

If the momentum sustains, the stock could climb to Rs 2,500 over the next one to two quarters, making Lupin a hold for now. For investors comparing the two names, the message was clear: Voltas looks like an exit-on-strength story, while Lupin still appears to be a wait-for-recovery bet.