Andrew Holland, CEO, Avendus Capital Alternate Strategies, doesn’t see any catalysts for the Indian markets to move higher.

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“The markets, even with the correction we have had, is still a little bit high. Therefore depending on what the budget brings us, I don’t see what the catalysts are for the markets to move higher in the very short term. I am not saying they are going to go down, they might trade around these levels but I don’t see what the catalyst is at the moment unless there is something in the budget which was surprisingly good but I am not expecting that at the moment,” he said in an interview with CNBC-TV18.

On auto sector, he said, “We like it longer term but in the short term as well we had a good price rise about a month ago, so it has been a good time to enter again on the back of some of these good results that we see and the expectation that the expenditure towards cars and two-wheelers would continue. I don’t think that is going away from us in the medium term. So it is a good place to be in terms of longer term.”

In terms of Union Budget 2021-2022, he said, “I don’t get overly excited for the budget. We have to make sure that there is no negative tax rise on tax implications which could hurt the markets. Other than that, if they continue to do what they have been doing in terms of money towards infrastructure, healthcare and so on, I think that would be what the market would like.”

“We are not going away from the medium-term view that growth will be led by Asia over the next three-five years but at the moment, I would rather wait and see what the budget is, I would rather wait to see what China does with its monetary policy, that is a concern to me,” he mentioned.

China starting to tighten is never good for liquidity in Asia and that is something to watch out for, he said.

Shortage of containers is a real problem for importers and exporters, he noted.

According to him, in the banking sector overall, the private banks still have some underlying problems.

“We are not seeing the growth pick-up yet in the economy, which is giving us confidence. There are great results but no real catalyst now in the next whole quarter for these stocks to move higher. So I think whilst I like the banking sector for the longer-term recovery, a lot of it is priced in in the very short term,” Holland mentioned.

For full interview, watch the video…

(Edited by : Niral Sharma)

First Published:Jan 29, 2021 11:18 AM IST