Now is a good time to invest in automobile companies as they are trading at reasonable valuations, said Ajay Srivastava, CEO of Dimensions Corporate Finance Services.

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"Moreover, we are ignoring the benefit of the falling interest rate that may help the sector," he said in an interview with CNBC-TV18 on Friday.

With regards to IndiGo, which was hit severely in the last two trading sessions due to the ongoing dispute between its two promoters, he said, "We have a holding in IndiGo and to that extent are positive. We haven’t sold out and are adding little."

Srivastava said the budget blow for the market is over but we have got a contraction in Singapore GDP which doesn’t auger well for us.

“One-tenth of the market is grappling with optimism but 90 percent of the market is fairly valued at a point which is a disastrous demand-supply scenario. So, India’s midcap story is perhaps factoring it in but the key question is about the future of top 10 stocks that are in our portfolio because we have seen Titan, IndiGo meltdown and there are only 7-8 to worry about like PVR, HDFC, etc.," he said.

“We need to understand that some of the old-tier companies are not going to be the winners of the next five-ten years and we have to let them go. So, it would be more sector-specific, more specific to industries and more specific to mid-sized companies that are facing a challenge in the new economic paradigm. So one has to change their thinking about the way we want to approach the largecaps," he further added.

First Published:Jul 12, 2019 10:40 AM IST