Banks, auto, realty & infra attractive now: Amisha Vora

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Banks, auto, realty & infra attractive now: Amisha Vora

Amisha Vora of Prabhudas Lilladher spoke to CNBC-TV18 of her expectations of the market going ahead.

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Excerpts from Markets Midday on CNBC-TV18 Watch the full show » ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets Jaiprakash Asso BSE | NSE 31/05/12 Are Mutual Funds betting on Jaiprakash Asso? Other Stocks in this news IVRCL | Jyoti Structures |

The market reacted sharply to the booster received from RBI of a CRR cut of 50 bps that will ease the tight liquidity situation by infusing Rs 32,000 crore into the system. The Nifty jumped over the 5100 mark, a gain of 2% immediately, and the Sensex too shot up. Amisha Vora of Prabhudas Lilladher spoke to CNBC-TV18 of her expectations of the market going ahead.

Below is the edited transcript of the interview. Also watch the accompanying video.

Q: Technically at least the verdict that we got is that the markets are very much in their uptrend. How would you read the policy reaction and do you foresee more upside after the 2% that we have already seen?

A: The policy action, to some extent though, was expected that RBI will not be in a hurry to touch upon the repo rate, I think CRR action also market has really welcomed. Also, at a time when rupee has started appreciating or stopped its southward journey, one gets little confidence that going forward the manufacturing inflation which didn't give in till last month will also start softening. So the RBI view that only when they see inflation softening a bit more or manufacturing side that they will take the next step, I think, also looks a good possibility.

Having said that it sets a good bottoming out process in terms of all- the growth outlook also, markets have had a good run of more than 9-10% and closer to 5150 levels which it is at currently. We would think that it is closer to its upside potential, short-term pre-budget of about 5250 or so. We would think that the rally has shown good strength and it may not substantially go down, but the upside would remain slightly capped for a while.

Q: If you had to take a call now in terms of nibbling into certain sectors within the markets, which one would you be most attracted to post the policy?

A: I think the rate sensitives as what the sectors get classified includes banking typically, autos and real estate. Banking, of course, has given huge thumbs up to the change in the stance by RBI. Autos are in their own trajectory. They had never corrected so much and they will continue to do well. But I would like to add one sector which is the construction and infrastructure space where most of the company's interest outgo is almost two-four times the net profit. I would think that they also become extremely interest rate sensitive looking at the impact of interest cost on their bottomline. I would say that from here on, stocks like Jaiprakash or some of the stocks including IVRCL or Jyoti Structures as also some of the asset owners would qualify for a look. I think they should also start participating in the rally.