Manufacturing, Capex Themes Have Great Opportunities, Says Ace Lansdowne's Vikram Kotak
Automobiles, a few select private banks, and companies focusing on financialisation of savings, too, have positive opportunities.
India's manufacturing and ancillary sectors, like cement, have growth opportunities given the high government capex and state incentives for these sectors, according to Ace Lansdowne's Vikram Kotak.
Other sectors, like automobiles, a few select private banks, and companies focusing on the financialisation of savings, too, have positive opportunities, Kotak, co-founder and managing partner at Ace Lansdowne, told BQ Prime.
However, the outlook for export-dependent sectors like IT, energy, chemicals, and metals is unfavourable as they are impacted by a global slowdown, he said.
"The biggest positives in India are small- and mid-cap stocks," Kotak said. With almost two years of consolidation in small- and mid-cap stocks, he said, it is a great time to slowly start building a portfolio in these stocks, especially with the possible rate cuts in the next few months.
A number of factors, such as unstable geopolitics, declining international trade, a potential global slowdown due to high rates, high inflation, and supply-side constraints, have an impact on riskier assets, according to Kotak.
The Indian rupee is likely to face appreciation in the long term with declining dollar outflows, while the dollar's hegemony will remain intact for the next 15 to 20 years, he said.
However, the quality of the management is the most important metric to gauge bets on companies having future potential despite poor past performances, Kotak said.