Why Shiv Puri of TVF Capital prefers these sectors despite high valuations
Summary
In the consumer market, for instance, Shiv Puri notes that there are still aspirational consumers who spend on discretionary products and services. Similarly, in the retail sector, premium discretionary brands are performing exceptionally well.
Although overall market valuations are high, earnings growth in certain sectors continues to surpass expectations, and Shiv Puri, Founder and MD of TVF Capital Advisors, recommends carefully selecting these sectors for new investment opportunities.
In the consumer market, for instance, he says there are still aspirational consumers who spend on discretionary products and services.
There is notable spending in healthcare, fueled by both insurance coverage and increased disposable income. Consequently, top-tier hospitals are experiencing robust growth.
Similarly, in the retail sector, premium discretionary brands are performing exceptionally well.
“I think those trends will continue for the for the rest of the year. So we’re quite excited about some of those areas. And these have been areas that we were involved with for a long period of time,” he told CNBC-TV18.
The financial sector, on the other hand, is facing some challenges.
On the macro level, a significant concern is the actions of the US Federal Reserve regarding interest rates.
On May 1, the Fed left interest rates unchanged at a 23-year high, and Chairman Jerome Powell indicated that while interest rate increases are paused, any reductions will depend on forthcoming data.
Currently, the data does not suggest any movement towards softening inflation to the Fed’s 2% target. As a result, liquidity is expected to remain tight, which will have implications for the rate cutting cycle in India and foreign investment flows.
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On the micro level, regulatory compliance has become increasingly critical in Indian financial services with the stringency of enforcement intensifying.
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