Largecap IT stocks may double in 4-5 years: Raamdeo Agrawal - Economic Times

NEW DELHI: Dalal Street veteran and Motilal Oswal Financial Services' chairman Raamdeo Agrawal says largecap IT stocks can double your investment in a span of just 4-5 years.

When asked by ET Now whether largecap IT stocks can double in three years, he said: "four years".

Agrawal said one can expect 15 per cent returns along with 2-3 per cent dividend in largecap IT stocks. "And these companies are very stable, very high quality, very global in character and they are inevitable for the global economy. They are not at the mercy of any government policies or regulation. Do not have too much expectation. A lot of things can happen, but expecting double in four to five years would not be out of place."

The investment guru is also of the view that the next set of multibaggers will come from the digital space as they are very small right now and the potential is very high. "The game is going to be far more exciting in digital companies and old companies that are digitising, like Bajaj Finance. In fact, all the successful companies from the old economy will go digital and that is where a lot of opportunities exist. One has to look for well-run companies that are increasing their digital quotient and those companies will surprise us in terms of multiple rerating and, of course, earnings growth."

He said in digital companies, earnings are not visible today but valuations are very high. In case of old-economy companies going digital, their valuations are low. As earnings growth comes, the market will be surprised by the earnings growth as well as by the valuation, Agrawal said.

The market veteran said in the next five-six years, Indian IT will deliver three-four mega companies like Infosys, TCS, HCL Tech and Tech Mahindra. These companies will grow from Rs 15,000-20,000-30,000-crore to Rs 1-2-lakh-crore companies.

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Largecap IT stocks may double in 4-5 years: Raamdeo Agrawal - Economic Times
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