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NEW DELHI: Indian investors did not make much money in calendar 2015. The index is down over 8 per cent during this period, but analysts say calendar 2016 is likely to be much better.

The view on the Street is that the market might remain volatile in calendar 2016 weighed down by both domestic as well as global factors, but it will still be an important year for the domestic market. Analysts advise investors to focus on building a long-term portfolio by accumulating stocks on dips.

One of the prominent factors would be the impending rate hike by the US Federal Reserve, whose tremors would be felt for much of 2016. This is because, more than the December rate hike, the trajectory of future rate hikes will be in focus.

Other important triggers would be the Reserve Bank of India’s stance on key policy rates and corporate earnings growth which most analysts expect to bounce back in the second half of FY16. And if goods & service tax (GST) bill goes through in winter session of Parliament, analysts expect the market to rally 4-5 per cent on the back of that trigger.

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“The stocks we pick up today will make money in 2017-2018. In each industry, there are some gems available. I love utilities, and in this kind of markets, utilities look like a screaming buy to us or a contra play,” said Nimesh Shah, MD & CEO, ICICI Prudential AMC.

Shah said quality at any price has not worked in 2015. “We are not buying quality at any price, quality at reasonable price is something that we focus on. I do not think stocks that have worked in 2015 will work going forward,” he said.

Here is a list of top five wealth-creating ideas by experts with a minimum investment horizon of 12 months:

Analyst: G Chokkalingam, Founder, Equinomics Research & Advisory

HIL: HIL is one stock which I would like to recommend. Old name for the stock was Hyderabad Industries Ltd. It is part of CK Birla Group Company. The company is into building material business. The beauty of this company is that it has got multiple plants, and does not have lot of debt on books. It has been paying excellent pidend. In the September quarter, it posted a marginal loss, and because of that so that the stock crashed.

This company is engaged in building products primarily for rural housing, and the monsoon coincides always with the September quarter. Historically speaking, this company has always posted very poor results in September quarter. The market did not understand this fact, it hammered. There is another thing to highlight. In the last three years it has increased capex by 50% and going forward for the next two years its earnings per share (EPS) can expand substantially. That’s why I recommend this stock.

Andhra Sugar: This is one of the most efficient producers of caustic soda and sugar in the country. Despite operating in commodity businesses, this company has been giving pidend for three decades without any interruptions.

Now, it has turned around the sugar segment. It is one of the few companies in the country who has already turned around the sugar business. It is an asset rich company, it has also got investment in Andhra Petro and also AP Gas Power Corporation.

The replacement value of assets is more than Rs 2,000 crore, whereas enterprise value is hardly Rs 500 crore. And with rupee depreciating badly, I firmly believe that caustic soda being an import substitute could give robust earnings in the next two years. Two business verticals i.e. sugar and caustic soda can give robust earnings in the next two years.

In the last sugar cycle, it hit an EPS of almost around 30 and the share price of 265. I do not see any reason why it should not hit the same this time around.

Analyst: Vikas Sethi, MD, Sethi Finmart

Sintex Industries: Sintex Industries in addition of being a leading textile and plastics company is also into prefab buildings monolithic construction, custom moulding and waste water treatment solutions. This company is going to be a major beneficiary of the government’s focus on the low cost and affordable housing, Swachh Bharat Abhiyan programme and then the CSR initiatives by several corporates.

To add to that, the company is also putting up a new spinning capacity in Pipavav which is likely to be a starting commercial production in April 2016, and that would also lead to a huge surge in its revenue and bottom line.

Even the implementation of GST and the seventh pay panel recommendations would be pretty positive for this company, and that would lead to an improvement in the business environment for this company. Fundamentally speaking, it is a good company and has a very good growth prospect and as far as the valuations go, The company would report an EPS of Rs 11 for FY16 the current financial year.

It trades at just about nine times its current year’s earnings which is quite attractive. The brokerage is bullish on the stock from the current levels, and expects a target of around Rs 175 in a year’s time.

Lumax Auto Technologies: This stock has been in the limelight since last few days. This is a bleeding auto component company catering to mainly the two-wheeler and the passenger car industry. It has a very prestigious clientele such as Bajaj Auto, Honda, Maruti, Tata Motors, Peugeot and it enjoys a very strong relationship with these companies.

The company has shown a very good performance over the past few quarters, and there is prospect for tremendous volume growth with margin expansion in the coming years as well. To add to that, the financials of the company are pretty good as well, it has a very strong balance sheet with negligible debt and high return ratios.

As far as the valuations are concerned, the company is expected to report an EPS of around Rs 26 for the current financial year which would means it is quoting at just about 14 times its current year’s earnings. The company has also recently ventured into aero space and defence which are very promising sectors, with growth potential. The brokerage has a buy recommendation on the stock with a target of Rs 550.

Morgan Stanley:

Coffee Day Enterprises: Morgan Stanley has initiated coverage with an overweight rating on Coffee Day Enterprises with a 12-month target of Rs 332. The coffee business emerges as the dominant value driver, said the global investment bank.

CCD is India’s largest QSR in a nascent category. They think that same store sales growth (SSSG) could beat inflation will drive strong earnings growth for this business.

FY17 implied EV/EBITDA is at a 49% discount to Jubilant on our estimate, said the report. Operating margin expansion for the coffee business could surpass market expectations.

(Views and recommendations given in this section are the analysts’ own and do not represent those of EconomicTimes.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)