FII flows going largely into IT, pharma, FMCG, financials sectors: Prabodh Agrawal

In a chat with ET Now, Prabodh Agrawal, Head of Research, IIFL Institutional Equities, shares his views on FIIs.

ET Now: Which way is the global money then wanting to flow because they are all heavily invested in IT, pharmaceuticals which have already given them a very handsome return? Are they now wanting to turn towards midcaps where there is bigger money to be made? Is PSU a theme with them? What are they feeling about these two spaces?

Prabodh Agrawal: Yes you are right. The thing is that over the last five-six years, we have seen the FII flows going largely into four sectors which is IT, pharma, FMCG and financials. Now many of these sectors as well call them are scape India stories. These are not really India stories when we say IT, pharma especially and some of the global cyclicals. Now actually we would want to buy sectors and stocks which are pro-cyclical which will benefit as the Indian economy does well. So I would think that incremental money flow would be elsewhere.

In fact some of the existing money would also rotate into the pro-cyclical names. So the new money would not necessarily go into midcaps. Of course midcaps is a segment which has done well and I believe will continue to do well. But even some of the large pro-cyclical names is where the new money would go in, both FII as well as DII.