Samir Arora, Founder & Fund Manager, Helios Capital, thinks that the market hasn’t discounted the macros yet and inflation, coronavirus along with the Russia-Ukraine war still remain an issue.
In an interview to CNBC-TV18 on April 26, Arora also talked about the banking space, LIC IPO and the new-age technology firms. Edited excerpts:
Do you think most of the bad news is now digested? Is it becoming a buy-on-dips market?
I don't think the market has fully discounted the macros yet because the market has not fallen a lot. The market is down less than 2-3 percent year to date. Major issues like inflation, COVID-19 and the Ukraine war still persist. The Indian public is a bit over-excited.
Outlook on the banking sector?
Banking could be an outperformer in the next few years due to improved asset quality. We are overweight on banks and our largest position is in the banking space.
Also read: LIC IPO dates and 9 highlights you need to know
Who to back amongst ICICI, SBI and HDFC Bank?
We have all the three banks in our portfolio and all the three banks are nearly seven percent each. HDFC Bank was always in our highest position. The bank to be bought out of these three is HDFC Bank. If HDFC Bank does a little worse than ICICI Bank it does not make it a sell. There is an over-analysis of some of the quarterly earnings.
Also read: How do ICICI Bank and HDFC Bank stack up, in five charts
Do you have any position in new-age technology companies like Nykaa or Zomato?
There are two groups of companies that are at high valuations, first, consumer companies, and second, new-age tech companies. We mostly don't like both. There is no reason to buy global or Indian new-age tech companies.
Do you own any of the Adani group stocks?
No, we don't have any Adani group stock. These stocks have gone up too fast too soon for us to analyse them.
Views on the LIC IPO?
LIC now has really come at a price where it looks like the government wants to do a deal. The only issue is low float. LIC IPO is quite cheap at its current valuation. Therefore, we might apply for the LIC IPO. We have not tried for applying as an anchor investor.
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