Volatility in markets to prevail and global growth likely to see a slowdown, said Nilesh Shah, CEO of Envision Capital.
Volatility is likely to prevail across all markets, said Nilesh Shah, Managing Director and CEO of Envision Capital, adding that global growth is likely to slow down.
Shah told CNBC-TV18 that a host of global events or macroeconomic factors will drive sentiment and determine the market's direction. He also said that there was nothing to look forward to in terms of earnings.
Talking about India, Shah said, “Slowdown in global growth will ensure that commodity prices remain capped, which is a positive news for inflation and margins for corporate India." However, he added that the day to day volatility will remain.
Giving his outlook for 2019, he said that the first half could be a period of consolidation and as would emerge in terms of elections, interest rates, etc in the period, the second half could be significantly better.
Sector specific, he said valuations still remains a big challenge for domestic consumption stories. However, cement looks very attractive at current valuations aided by lower raw material prices. Margins for them also could turn positive for the sector, said Shah, adding that the core demand is still intact. “See long-term value emerging in the cement sector and it is a good proxy for India’s long-term growth potential."
He said the house is still positive on IT sector. "Right now the space looks to be on the cusp of 10-12 percent growth and if that comes through, it would give them operating leverage," said Shah. "The big challenge for the sector could be wage cost and attrition but it still remains a relative safe haven in this type of vitality."
"See very low competitive pressure for insurance players. While one should play the consumption growth through consumer durables," he added.Source: CNBC-TV18