Add utilities, telecom, pharma, oil marketing companies: BoAML

Sanjay Mookim of Bank of America Merrill Lynch says the near-term impact of demonetisation is difficult to model.

He further says channel checks suggest sales are down between 30-50 percent but may now be slowly improving.

Cutting weights in consumer discretionary stocks as long as this uncertainty lasts should help, but investors should track demand trends for an opportunity to get back in, he feels.

Mookim says the conservative portfolio now would look to add utilities (power, gas), telecom and oil marketing companies (unaffected by any of this).A more balanced outlook would be to add also to pharma/staples (less risk under a US president-elect Donald Trump administration) and quality banks (greater benefit from deposits than risk from SME NPA), he adds.