Top 10 Stocks To Buy Now 2018 By Motilal Oswal

Stocks to Buy in the correction – prefer a mix of growth and value plays

The sharp correction in mid-caps makes stock-picking a bit less challenging, as valuation premiums have moderated from the recent highs. While we do not rule out further correction, we believe, given our earnings recovery thesis for FY19, this correction offers a good opportunity to accumulate quality ideas where valuations had turned expensive. We favor a mix of growth and value plays benefitting from the key themes of

(a) Consumption Recovery – both urban and rural,

(b) Financialization of Savings, and

(iii) structural trends like Formalization of Economy post GST implementation. On value side, we suggest names that are relatively unpopular but where underlying dynamics are turning favorable, and also those where valuations are at a significant discount to sector.

We highlight 10 stocks from our universe, where we believe

(a) growth visibility is healthy and outlook is strong and

(b) there has been at least 15% correction from
52-week highs, and our target upside offers a healthy return potential.

Our preferred ideas are: HAVELLS, EMAMI, JSPL, IGL, RBL, EXIDE, Oberoi Realty, REPCO, MCX and TEAMLEASE.

Among the large-caps we like HDFC, ICICI Bank,Larsen & Turbo, M&M, Motherson Sumi, Titan, HPCL and NMDC.