As PSUs gain strength, pvt banks should speed up: Elara Capital

Private banks had been outperforming due to stress in public banks. But state-run banks are now regaining strength, and Harendra Kumar of Elara Capital says it is time for private banks to step up their game. "In the last one and half years, private banks have not done much. So, there has to be a shuttle between PSU to private now," said Kumar while speaking to CNBC-TV18.

On the spat between the founders and the board of IT major Infosys, Kumar says the backing that the company has from the foreign institutional investors (FIIs) should help it tide over the issue.

After the huge amount of selling over the last 4-5 months, the FIIs are coming back to India. This means that the momentum of the next 3 months is going to be high. This is good news for the tech companies as this sector is preferred by the FIIs apart from pharma. However, in the pecking order, suggested by Kumar, Wipro is at the top followed by TCS and then Infosys.

As the demonetisation pain is easing, consumer discretionaries are returning to normalcy and auto stocks are performing well. Kumar says with progressive investments and phenomenal fiscal stimulus given to the rural economy, demand will return and companies in the consumer space will breathe a sigh of relief. As for the auto stocks, he said Hero Motocorp demonstrated good margins and he bets on Maruti and Hero in this space.For full interview, watch video...