Bullish on healthcare, FMCG, auto: Orpheus Cap

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Mukul Pal, CEO, Orpheus Capital said the market is short of leaders and there is no real bull left, barring FMCG, healthcare and auto.

 

He told CNBC-TV18 that he is bearish on Reliance and ONGC both where he sees sub Rs 2,000 levels on Reliance and sub Rs 600 on ONGC.

 

Excerpts from CNBC-TV18's exclusive interview with Mukul Pal:

 

Q: What is the approach to a market like India? What is your sense of where it might be headed in the near-term?

 

A: From the kind of selling we are seeing, we should see some lower prices. But we are not expecting Q3 to be negative but positive. So, for us, these are prices to buy in. We need to look at the sectoral view and we are not trying to look too far down.

 

Q: In the short-term, do you subscribe to the argument that the market might be headed towards the lows it saw in March or even earlier this year?

 

A: The March lows on some of the sectors has already breached. So, there is going to be some sectoral play where some sectors might continue to bounce less and some sectors might see new highs. So, we really look at March lows based on sectors. Healthcare is still a sector that should push up. Even slow sectors like FMCG should see some growth here. We feel that oil should ease. Auto might also see some good bounces from here.

 

Q: What would you churn out of from the Indian stock universe because there has been a lot of pressure on leaderships sectors like capital goods and banking?

 

A: Capital goods and oil would be the only sectors that were trying to hold the markets. The last sector has also broken down in April 2008. This means that we are short of leaders here and do not feel that there is any real bull left, barring FMCG, healthcare and auto, because auto is a contrarion play for oil. So, we really do not think that oil is going to hold. Oil prices and the stock and sectors, which leads oil prices should continue to see downside pressure.

 

Q: Any preferred pick from the two sectors you have just talked about, autos and FMCG?

 

A: For BSE oil, we are bearish on Reliance and ONGC both and see sub Rs 2,000 on Reliance and sub Rs 600 on ONGC. These are the first prices that we see.

 

In pharma, we are looking at Cipla and are positively biased about HLL .