Three themes that you should play this year: Umang Papneja, IIFL Wealth Management

In a chat with ET Now, Umang Papneja, Managing Partner & Chief Investment Officer, IIFL Wealth & Asset Management, says IPOs, branded goods and infra stocks are going to do well this year.

Edited excerpts:


With the market having run-up so fast, is there a left-out feeling now among investors?

The left out feeling which you mentioned is the right way to put it. Pre-budget, there was some doubt whether there would be some long-term taxation on equities or not. So that clearly did not come. A lot of clients were waiting to see whether this comes or not and they were sitting on the fence. Clearly that buying has come with full force and that left out feeling has come in.

If you look at domestic flows, they have been very strong leading to that 1000 point rally which you were mentioning. But having said that, it has also been supported by good numbers, so I think the buoyancy in the market should continue.

What are the themes you are bullish on?

I will mention a couple of things which we are quite bullish on. First, a very old theme people keep taking advantage of a lot. The pre-IPO and IPO theme. A lot of IPOs are expected to come out this year and if you just be stock specific and look at very good IPOs, a lot of money may be made in IPOs in general.

Second, a lot of unbranded players are facing heat in their businesses and we are seeing a clear move from unbranded to branded. Some companies which are in the listed space are clearly taking benefit of this. This process has been hastened thanks to demonetisation. Because the amount of cash transaction has come down, it has lead to people buying more and more branded products. So that is a second theme which I think is very strong.

We also like a few infrastructure names, so infrastructure is also probably going to do very well in this year. So in all these three themes look very good to us.

We recently saw the Nifty breach 8800. Since then, we are back below those kind of levels. Do you think it is possible that we could retest 8000 in the next few months or is that chance very, very slim?

At this moment, I would not ascribe too much probability to it so I would rather place my bets on 9000 first than 8000. I do not think at this moment I would be placing my bets on that at all.