Believe power sector is underperforming: Jagannadham Thunuguntla

In a chat with ET Now, Jagannadham Thunuguntla, Head of Research, SMC Global Securities, shares his market outlook. Excerpts:

ET Now: How are you assessing the market right now? Which are your top contenders to ride this momentum which we have seen in the past 200-500-point rally on the Nifty?

Jagannadham Thunuguntla: We are in one of those markets where almost each and every name -- be it small cap or midcap -- is doing well. These are the times one has to be slightly careful because if you get stuck with a bad stock on the way down, that time can be quite punishing.

I feel that power is one sector which is clearly underperforming.

ET Now: We will talk about the power sector in greater detail, but what is the view on the crude oil prices slumping to those 16-month lows? Is this going to build well for some of the PSU OMCs?

Jagannadham Thunuguntla: This is the best thing that can happen for Indian macros because Indian macros are always vulnerable and susceptible to the high crude oil prices because we still import 80% from foreign countries.

So any dip in the crude oil prices will help India in, say, containing current account deficit and forex reserve balances etc.

ET Now: Things are looking fairly strong for the cement space as a whole. Are you bullish and which stocks would you pick out?

Jagannadham Thunuguntla: Cement stocks are good, but I feel that relatively they may not give any additional alpha. They may be at best market performer, if you see from five to six months’ point of view. I still feel that Ambuja can be one option and ACC can be another option.