While IT stocks have factored in the negative effects of US President Donald Trump's protectionist measures such as the H1B visa reform, a possible revival of the US economy under Trump administration has not been priced in, according to Jonathan Schiessl of Ashburton.
A revival could bring back demand for the local IT firms, said Schiessl.
No new exposure
He recently added more exposure to HCL Tech and Tech Mahindra recently. Ashburton has not added more exposure in Infosys.
Ashburton has not added any new names into its portfolio after Endurance Tech's IPO in India. It is neutral on financial companies, and has not added any new exposure in the space.
"The recent rally in the Indian market caught us by surprise. The valuations are not justified, considering the earnings that companies have reported," he says. For instance, he says Ashburton does not have a lot of exposure in the consumer staples space as its valuation is disheartening.
He has also noticed a big up move in the mid-cap space, but he feels foreign institutional investors (FII) have no hand in its rise.
Ashburton, he said, is interested in the retail space and is looking at some key names in the industry. It is also planning to invest in stocks with cyclical exposure.
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