Bank of Baroda, which has a strong loan book, has consistently exhibited loan book growth of a few percentage points more than that of the larger and older banks, to emerge as the third largest state-owned bank in the system, behind SBI and PNB. The bank has benefited from a large overseas book, which comprises around one-fourth of its total portfolio and offers a perfect complement to the

bank’s domestic lending operations. It has always maintained a disciplined approach towards underwriting that reflects in the lowest incremental delinquencies in the banking sector, despite an economic environment that is not particularly conducive to sustaining such superior asset quality. The bank boasts of a consistent record of high profitability and a superior efficiency ratio. It has one of the lowest cost-to-income ratios among banking stocks, as well as high return ratios. The bank looks like a safe bet among PSBs. One can look at the stock from a medium-term perspective.

Cummins India is the strongest engines player, given its presence in the large engines segment. Almost 70 per cent of the revenues are generated from this segment. It is backed by superior technology and strong brand recall in generator sets and engines. A strong dealer network, including OEM partners and 40 exclusive dealers, is responsible for almost 70 per cent of its generator set sales. Besides, the company’s numero uno position appears defensible in spite of the presence of strong global players in India like Volvo, GE, Mitsubishi, etc. Cummins is likely to emerge as the best-in-class franchise, given high operating cash flows coupled with some of the best return ratios in the industry. A recovery in its capex plans is also likely to be witnessed from the next fiscal onwards, which may induce some positive vibes in the counter. One can look at the stock from a medium-term perspective.