If you just go over the last six months, one year, two years, three, five, it is very consistent that India and the US, these are the only two parts of the world which actually have growth and you have momentum in the markets.
Pharma is something that we are expecting to do reasonably well. Consumption is another segment and it is a very important part of the market, but consumption growth is clearly kind of subdued.
Ashi Anand, CIO of Valcreate Investment Managers, finds PSU banks, particularly SBI, attractive. Defence sector and Bharat Electronics are promising. Power, infra, hotels, and hospitality sectors show potential. Small finance banks need proven value creation. Consumer staples await demand growth. Private banks face valuation ceiling. OMCs is seen as a space where one can trade and currently there is momentum, but this is not a space where a longer-term value creation opportunity is there.
“The pain of very large corporate NPAs that they recognised over the last four-five years has now gone away and they are going through a period of normalisation. We are a little more comfortable with the higher-quality PSUs and I think SBI clearly stands out out there.”
Ashi Anand says: “Timing when the markets will turn and when largecaps will start delivering more than small and mid, is very difficult. But the danger with investing in smallcaps at this point in time is that when markets turn, what you have seen historically is that when small caps fall, they can fall very, very sharply and at very low liquidity. So you may not be able to get out.”