Commodities is a tricky call: Dhiraj Agarwal, Standard Chartered Capital Markets

Dhiraj Agarwal, Director, Institutional Equities, Standard Chartered Capital Markets,in an interview with ET Now talks about the banking sector

Are you telling your clients bet on companies which are dependent on commodities like Exide, Castrol, BHEL because if commodity prices they come down these companies will gain?

Commodities is actually a very tricky call. In the last two weeks they have come down depending upon what the commodity is, between 10% to 25% but that does not mean that the secular trend that we have seen in commodities is over. Barring short term trading patterns in the next few days, couple of weeks the commodity users might benefit a lot, but from a longer term point of view a big winner still be companies who were able to manage the commodity price volatility whether it goes up or down or sideways which have some degree of pricing war, which have some degree of operation cost management in hedging. It is not a trended market even commodities are not really trended, last two is it is down. Two months down the line we might see them back at the highs. It is dangerous to take a view on any theme or trend saying commodity is busted start buying commodity users, start selling commodity producers I do not think so. It is again very very company specific and stock specific environment.