Infra stocks will give +ve returns in long run: Centrum Cap

Devesh Kumar, Managing Director of Centrum Capital, said he was bullish on the infrastructure sector. He said, "The infrastructure sector is worth looking at because in longer term, it will see positive returns."

Commenting on the market, he said it may trade sideways or rangebound ahead and that they would also be volatile.          

Here is a verbatim transcript of the exclusive interview with Devesh Kumar on CNBC-TV18. Also watch the accompanying video.

Q: What do we do at the moment specifically with real estate stocks because their entire hopes were pinned on the Qualified Institutional Placement (QIP) business? They went up almost 200-300% in some cases, realistic at these prices. What if these QIPs don't go through in the next one-two months?

A: I think in real estate based on success of two-three QIPs people thought that there will be money for all the companies. I think one should not be in the sector for QIP succeeding or not one should be there if you generally feel that the company has holdings in right markets. For example, we feel that Mumbai market is going to revive first and we are also seeing signs of revival in Mumbai. So, one has to build his portfolio and one has to identify the ones which will be winners and the ones which will not be the winners in the long-term.

Q: How should you play infrastructure stocks. Are they overvalued, should you go short at them or should you leave them if you have them in your portfolio?

A: If you look at infrastructure and market at large both, I think pre-Budget expectations and post electoral outcome impact both are in the price and I think people will not take a longer-term view till they have seen the expression of intent in the Budget. So, at this point of time one feels that some amount of profit booking particularly by overseas investors who have seen appreciation in terms of their rupee holding because rupee is becoming stronger and a run-up is expected and nobody will take a definitive view till one has seen the first expression of intent in former Budget by this government. I think one should not be chasing the stocks too fast. On drop, this sector is worth looking at because in longer-term there will be positive returns coming out of this sector. 

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