FMCG stocks to outperform among other sectors: Harendra Kumar

In a chat with ET Now, Harendra Kumar, Managing Director-Institutional Equities, Elara Capital, shares his views on pharmaceutical sector.

ET Now: Do you think pharmaceuticals is going to continue to be a pocket wherein one can see outperformance?

Harendra Kumar: The pharma stocks have done phenomenally well over the last two years. In 2015, there will be a lull in terms of rerating for the stocks because there are lot of headwinds in terms of the US FDA inspections, local NPA market.

I do not think the rerating to be as significant as some of the other sectors. The structural benefits to FMCG, if there is a rate cut, is somewhere in the middle of this year, it could spur demand and the raw material scenario is also extremely positive. So there is a double delta for FMCG stocks.

So despite the run up in 2015, FMCG stocks will continue to outperform some of the other sectors that we have been discussing. So between the pharma and FMCG staple or discretionary our preferences for the consumer facing companies at this given point of time.