See strong Q4 earnings on YoY basis: HSBC AMC

Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Q4 results to trigger mkt upmove: PN Vijay

Q: How would you go into earning season then? Would you keep some cash to spare or is it a good idea to go in fully invested because we are probably going to get more good than bad out of earnings?

A: Just following logically from what I said initially that YoY for Q4 should be pretty strong. I would remain invested, but if you ask me anytime in the year, I would say the same.

Q: You spoke about getting a lot of upgrades as earnings come in, if those are not going to come in from the global commodity space, where are you penciling in most of the upgrades for the largecap universe?

A: I think largely it would come from capital goods, industrials and basic manufacturing because I think the downstream nature of the kind of ordering, which has lined up in most of these capital goods companies, does reflect that eventually that will translate into orders and then eventually topline for a lot of companies which supply to the infrastructure and construction markets. So basically that is where the focus comes from which means that if that represents some sort of borrowing that they will need to do which means the banks will follow in terms of having pretty strong growth in lending. So you are talking about a very large chunk of the markets including banking start to show some buoyancy on topline.

I think going from thereon, you will also see pretty significant demand increases in cement, that is not very clear at this time because of the capacity additions which are likely to hit us. So pricing might be an issue and may not translate into quick profits, but the fact is I think mainstream manufacturing, your consumption will continue to remain strong, we are talking about a commercial vehicle cycle to start kicking in after the infrastructure starts coming in, which already some of the signs are being seen in the stock market with commercial vehicle manufacturers. So I think as a broad economy is where the call is and I think where the pockets of growth will come from is where the direction for the market will come.