Believes that industrials, metals, construction and real estate could be worth taking a look at.
Foreign institutional investors (FIIs) have largely been net buyers so far in November, a trend reversal of sorts, after months of selling on their part.
It raises the question whether their attitude is now changing towards India and are more flows likely?
Ambit Capital’s Pramod Gubbi believes it is still early days to give a call on the issue. “It could potentially be a result of short covering as well,” Head of Equities Gubbi told CNBC-TV18 in an interview. He said it could also be a case of FIIs betting on economic recovery, and the big bank recap programme the government announced recently.
Given the state of rest of the market, it may be the time to look at cyclicals, he said, adding, sectors such as industrials, metals, realty and construction, among others could be looked at.
Meanwhile, in the financials space, he is waiting for a meaningful correction in the private sector financial names. But, with the market seeing just brief corrections, valuations are not comfortable, he believes. So, corporate facing banks and larger PSU banks could be worth taking a look at. “Given that we are at beginning of capex, look at lenders who can benefit from loan books getting exposed to that cycle,” he told the channel.
With the upcoming state elections and the eventual general elections, he said this aspect will be on the minds of investors. But, this is also a market, which has looked beyond risks as well.
Given the government’s push for reforms going forward, one could look at construction companies along with real estate once the dust around RERA settles.Watch accompanying video for more details.