Bullish on IT post correction: Daiwa Capital Markets

In a strong market, what is it that you are buying? Any individual stock or sector that you are acutely bullish on?

Puneet Shrivastave: If you go from the bottom up approach, we feel that despite inflation remaining high and it possibly may remain high, definitely we feel that interest rates are peaking out and if that happens, auto and banking will be the first two sectors investors might look at. Those are sectors we are clearly overweight on. One sector we are still obviously concerned about is oil and FMCG, telecom, so oil obviously, there are issues about under recoveries.

Put together, it is contributing almost more than 1% of GDP, so there are issues how they are going to be sorted out, how government needs to subsidise. We are still cautious on the oil, of course especially on the downstream companies. If you see the telecom sector there are issues about intense competition, balance sheet issues and obviously there is uncertainty on the regulatory environment, so we are still underweight on that sector.

If you move on the IT side, we are actually pretty positive after the recent correction, though not as much the way the market has seen in other sectors but obviously if you see after the recent correction, Infosys and all are quoting at very reasonably valuations.