"If real estate sector is not changing, then economy is not going to move. The focus should be on 5-6 real estate stocks," he said.
As the new government comes in, the challenge for upliftment in economic condition and delivery of money to the poor will fall on nationalised banks, said Ajay Srivastava, CEO, Dimensions Corporate Finance Services in an interview to CNBC-TV18.
"The government has got a beautiful victory despite what we have seen in terms of economic numbers, car sales, GDP growth, I think it is a great thing for the organisation and the leadership. But the focus needs to be really to the going back to the 6-7 states which have serious drought conditions. Our best estimates is revival would not happen in the third and fourth quarter. Economic revival will not happen in these two quarters. At some point of time these auto stocks will stabilise," he said.
Srivastava said a major economic revival is not on the cards.
"If you are already invested heavily in the market then you should be cautious to add on. If you have a 3-year perspective it does not matter. I don't see a major economic revival. What possibly is changing in the stock market is that the extreme cap between the valuation of the large caps verses the rest of the market are very steep. People are hesitating to allocate more money towards the golden ten stocks, holding back investment and say that if there is change in government policies, one can see a real alpha return coming in from large variety of decent companies.
"One may see less investments in stocks like Titan Company, HDFC and more people waiting to see whether we should be investing in smaller companies and get alpha returns compared to the large caps. Let us see the policy direction, if it does not change the we stick to our portfolio choices and if it does change the it opens up a whole new gamut of investment because 90 percent of the companies in India are heavily under-invested in, he added.
Acccording to Srivastava, the most important direction will come from the NPA guideline from the RBI."We have to wait and see whether it is going to be a nice and restructuring oriented policy or it is going to be sledgehammer IBC sell policy because either of the two can change the direction of the market. If anything needs to change, it is the real estate sector. If realty is not changing, then economy is not going to move. The focus should be on 5-6 real estate stocks," he said.Subscribe to Moneycontrol Pro and gain access to curated markets data, exclusive trading recommendations, independent equity analysis, actionable investment ideas, nuanced takes on macro, corporate and policy actions, practical insights from market gurus and much more.