Consumer names not among top investment bets at the moment: Dhiraj Sachdev, HSBC AM India

In a chat with ET Now, Dhiraj Sachdev, Senior VP & Fund Manager-Equities, HSBC AM India, talks about the consumption space.

ET Now: What about the consumption names at this point? You have spoken about how you may not want to go completely overweight on consumption. There is this whole argument about earnings visibility. The consensus view is that there are valuation concerns; so investors are going to be underweight on consumption. But the stocks have surprised selectively?

Dhiraj Sachdev: Selectively, yes. But I would still suggest that the valuation gap in the sector is still pretty high. The growth in earnings has been modest and mixed in many cases.

It is mature market and we have already seen what has happened on the consumption demand side of late. There are other segments in the market that are attractively priced relatively than consumer stocks. These segments may expect comparatively better earnings growth than the consumer space. Why then should we not go for those?

The fact is that the market is divided between consumer defensive names, which are expensive, and relatively higher growth names or sectors which may be reasonably priced at this point.