Ambit Capital is cautious on the Indian equity market at this point, Dhiraj Agarwal, co-head-equities, told CNBC-TV18.

He said, “We are still slightly cautious on the market. I think the market, at this point of time, is sort of ignoring a bit of headwind and there has been rotational money flows into banks which are helping the index.”

Talking about autos, Agarwal said that volumes should pick up for Tata Motors and Ashok Leyland. “Names which have the fantastic tailwind of electric vehicles behind them, for example, Minda; valuations are difficult to justify and that’s exactly the challenge at the broad level that what you like is expensive and what you do not like is not that expensive. So most of the names which have good earnings traction going forward, the price discovery by and large done,” he said.

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On union budget, he said, “For the economy’s needle to move as a whole at an aggregate level, we do not need just central spending but we also need states’ spending.”

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He further said that Ambit has been positive on SBI and continue to remain so.

For the entire interview, watch the video