The Indian market is expected to remain volatile for the next 6-8 months due to macro headwinds and state elections, said Pankaj Tibrewal, senior vice president and equity fund manager, Kotak Mutual Fund.
“At best macros could consolidate at these levels and hence forth, we believe there is merit to be cautious on overall markets. Valuations overall are not cheap and hence volatility would be there for next 6-8 months,” said Tibrewal.
Talking about the impact of Sebi’s regulations, Tibrewal said, “We are a regulator entity and respect any verdict by the regulator and would take all steps to comply with in respectable time period.”
With regards to sectors, he said the house is of the view that the consumer discretionary space will do well as per capita GDP increases. However, in the short-term they could see some slowdown due to fuel price increases and commodity inflation creating a dent in pockets of the consumers.
He advised to “remain cautious on NBFC space and remain selective and own only retail oriented ones where liability is good and asset quality is not an issue”.
Tibrewal added the house is constructive on the real estate cum cement kind of players as over the next 3-4 years there would be massive consolidation in the real estate space. “Cement demand is good despite slowdown in construction on back of government spending on housing. There is an opportunity to create wealth in this space,” he said.
With regards to the Pharma space, he said one has to be very stock specific. “We have selective exposure to pharma in many of our funds; some that are exposed to domestic market and some exposed to US generic market.”