Daily Voice: This fund manager is strategically accumulating positions in healthcare, consumer staples in recent market pullback

Anirudh Garg is the Partner and Fund Manager at Invasset PMS

With the recent market pullback, "I'm strategically accumulating positions in sectors that historically show resilience, like healthcare and consumer staples," Anirudh Garg of Invasset PMS said in an interview to Moneycontrol.

According to him, these sectors provide a cushion during downturns as their products remain essential regardless of economic swings.

He is cautiously optimistic about the banking sector. "With improving asset quality and easing NPA pressures, banks are positioned to benefit as credit demand picks up in a recovering economy. Recent corrections have also created appealing valuations in this sector, making it a good entry point," said the Partner and Fund Manager at Invasset PMS, who has over 17 years of research experience in the stock market.

Which sectors have you started accumulating, given the significant correction since October?

With the recent market pullback, I'm strategically accumulating positions in sectors that historically show resilience, like healthcare and consumer staples. These sectors provide a cushion during downturns as their products remain essential regardless of economic swings. This defensive sector allocation helps balance the portfolio, positioning it for both stability and future upside as market conditions improve.

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Can gold prices reach the Rs 1 lakh mark?

It’s possible for gold prices to reach Rs 1 lakh per 10 grams, though it might take some time. Several factors, including sustained inflation, currency fluctuations, and ongoing geopolitical risks, could drive gold’s appeal as a safe-haven asset. Additionally, rising retail demand in India supports this price trajectory, given the cultural significance of gold. However, we should keep in mind that gold's price movement depends on multiple variables like interest rates and global economic stability, so while Rs 1 lakh is plausible in the long term, predicting the exact timing remains challenging.

Are you a buyer in the banking sector?

Yes, I am cautiously optimistic about the banking sector. With improving asset quality and easing NPA pressures, banks are positioned to benefit as credit demand picks up in a recovering economy. I am particularly focused on banks with strong fundamentals, diverse revenue streams, and proactive digital initiatives that drive efficiency. Recent corrections have also created appealing valuations in this sector, making it a good entry point. Still, thorough due diligence is essential, as factors like regulatory changes and economic uncertainty can impact bank performance.

Are you concerned about the slowdown in earnings growth?

Yes, the earnings slowdown is a point of concern as it often signals broader economic issues that could affect market sentiment. However, it's essential to distinguish between short-term fluctuations and longer-term challenges. Companies with solid fundamentals, innovative strategies, and the ability to adapt are generally better equipped to navigate these slowdowns. In this environment, I'm focusing on high-quality companies with strong balance sheets and reliable cash flows, as they tend to be more resilient and can emerge stronger once conditions stabilize.

Do you expect the equity market to recover soon?

While I avoid making short-term market calls, there are indications that the equity market could recover, supported by improving economic fundamentals and potential monetary adjustments. Historically, markets have tended to bounce back after corrections, especially when there's positive momentum in the economy. External factors like geopolitical developments and inflation trends will also play a role, so a cautious, long-term approach remains advisable. Staying diversified and focusing on quality investments is key during such uncertain times.

Do you expect any major change in sentiment and growth if Donald Trump wins the United States elections?

If Donald Trump were to return to office, we could see shifts in market sentiment and policy directions, especially around taxation, deregulation, and trade. His previous policies favoured deregulation and lower taxes, which boosted sectors like finance, energy, and defense. However, there could be renewed uncertainties around international trade, which might affect global markets. While a Trump win could create short-term enthusiasm in specific sectors, the broader economic impact would depend on how policies are implemented and received by both domestic and international markets.

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