Trade cuatiously in high beta real estate names: Ajay Bodke

In a chat with ET Now, Ajay Bodke, Head-Investment Strategist & Advisory, Prabhudas Lilladher shares his view on the real estate sector.

ET Now: Couple of the real estate and infrastructure plays have been springing up in trade. Do you sense this is just a trading move or one can buy into this rally as well?

Ajay Bodke: I would tend to be very cautious trading into some of the real estate names because I still feel that the interest rates will continue to be on an upward curve for sometime because in the last three months we have also seen WPI disturbingly moving to a zone which is outside the comfort of RBI. On a trot for three months it moved up in addition to CPI being within a close distance of 10%.

So, we are still on an upward curve insofar as interest rates movement is concerned and insofar as demand is concerned, I still feel that the demand has not really picked up on the real estate side. So both on the demand as well as on the cost sides, the companies will continue to encounter lot of headwinds and hence one needs to trade very cautiously in the high beta names in the real estate sector.