Infrastructure Stocks To Cement Your Portfolio!

Infrastructure as a sector will always be in the limelight in India. That’s because there is huge scope for development and almost always infrastructure development is a priority for any government. Yogesh Supekar and Karan Bhojwani discuss why stocks in the infrastructure space should be part of your diversified portfolio even as the DSIJ Research Team recommends top picks in this sector for investments

- Yogesh Supekar and Karan Bhojwani

Equity investment is all about portfolio management, which is nothing but investing in a diversified manner across various sectors. Choosing the right sectors to invest in is one of the core elements of overall portfolio management. While being stock-specific can yield good results in terms of portfolio returns, choosing the right sector to invest can help achieve portfolio goals. Says Partho Gosh, an investor who believes in maintaining a diversified portfolio: “Sector selection is extremely crucial. I invested a large chunk of my portfolio monies in the pharmaceutical sector, which underperformed over the last 3-5 years. It started catching up only in 2020. If I would have given higher weightage to private banks, my portfolio would have been performing much better.”

Indeed, the sectoral allocation is crucial and can determine whether your portfolio goals are fulfilled or not. When it comes to sectoral allocation and maintaining a diversified portfolio, the infrastructure sector is always considered an evergreen option for investing. Infrastructure stocks have to be part of any model portfolio if it needs to tap the India growth story. It is a huge sector for a growing economy like India and opens up a lot of investment opportunities for investors in the stock market. This space includes oil and gas, automobile, telecom, construction, tyres, ports, cement and cement products and power. The table below highlights the weightages of sub-sectors within the infrastructure space in Nifty 50.