Avendus Capital-Alternative Strategies on Tuesday said it expects some amount of duty hikes in the upcoming union budget presented by union finance minister Nirmala Sitharaman.

In an interview to CNBC-TV18, Vaibhav Sanghavi, co-chief executive officer, said, "Markets would always expect the best or they would have the highest of hope every time. Whether fiscal is loosened by about 10-20 basis points, my sense is that it wouldn't really matter. So, moving the economy from about 6 percent growth to 7.5-8 percent growth on a consistent basis, we need to kick-start the economy at this point of time. I am not sure how much the new government can do it in a short period of time."

Speaking on markets he said, "We have been maintaining for some time now that the rally would be led by the large-caps. Until the time we see a broader economic growth, it is going to be difficult for the markets to have a very broad rally. In the event that you have some mishaps on the lower midcaps, people are generally averse to gaining that kind of exposure there. Also from a global perspective, if you look at passive money coming in, the first target in terms of their investments would be the large-caps and that is why we are seeing the kind of rally which is concentrated into very few names there."

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