Published on Thu, Jan 21, 2010 at 11:05 | Source : CNBC-TV18
Updated at Thu, Jan 21, 2010 at 15:26
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Why is Mirae Asset betting on banks?
Rahul Chadha, Head of Indian Equities, Mirae Asset Global Investments, says banking may be an interesting opportunity over the next six months. He is underweight on the oil and gas space.
Q: Have you been looking at any of these primary market issuances especially the FPOs because there is expected to be a lot of interest generated around something like an National Thermal Power Corporation (NTPC) FPO?
A: I think a lot would depend on the valuations which these stocks come and they aren't very cheap. So I think it has got to be a very stock specific approach over there. But in our funds we remain fully invested. So there isn't much scope to take significant exposure to any of these offerings.
Q: What would be your top overweight right now in terms of sectors?
A: We continue to be positive on auto and pharmaceuticals. These sectors have done well for us because we believe that these are multi-year stories and these are beginning of trends, which are going to last at least two-two and a half years. We have seen one year of these trends. So in our portfolios we remain underweight oil and gas, real estate and that underweight is utilized for increasing exposure to auto, pharmaceuticals and industrials.
I think in industrials, particularly we have more positive on midcap industrials - companies with a market cap of between USD 3 billion and USD 6 billion because we believe that these companies have demonstrated execution ability over last ten years. Once the huge opportunity unfolds over the next five-seven years, they can show much superior growth to the USD 20 billion plays in the market.
