Midcaps are also currently trading at about a 40% discount to the larger stocks on 12-month forward P/B multiples. Themes
are early cycle plays (autos, select industrials); pick-up in reform momentum especially in GST (consumer, logistics, CVs); increased attention to agriculture (crop protection, seeds, irrigation); improvement in consumer sentiment (discretionary, real estate); increasing corporate activity (corporate lenders, credit rating); and midcap-largecap valuation gaps within a sector.
Some of the midcap stocks recommended by Credit Suisse are plays on the above themes include Ashok Leyland (early cycle play), Emami (significant valuation discount to largecap peers), ING Vysya (corporate loan growth and high operating leverage), Kajaria, Oberoi, and TTK Prestige (improved consumer sentiment). HOLD or ACCUMULATE on Correction from Current Levels.
