Pharmaceuticals is the space to watch for the next couple of years, Envision Capital's Nilesh Shah said in an interview to CNBC-TV18. Big Pharma has a long pipeline of launches for highly competitive markets such as the US, said Shah, MD and CEO of Envision Capital.
“There are some blockbuster opportunities which are likely to unfold over the next few quarters, and that will take care of some of the recent concerns in terms of pricing pressure going away or the base portfolio of generics facing price erosion... I think they will have some significant launches going ahead,” he said.
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Speaking on the power space, he suggested avoiding conventional generators, and said it is better to play the theme through ancillaries.
"ABB Power Products is a major leading player in transformers. So much action is happening in the renewable space. Triveni Turbines essentially is going to play a very significant part with all the private sector capex happening in the power space... Look at names that are leaders, are focused, niche and capital-efficient, and where there is still a lot of headroom to generate alpha over the next few years,” he said.
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Shah prefers auto ancillaries to auto stocks, as the demand for components is going to remain be it electric vehicles or conventional plays. “The auto component space is a much effective way to play the entire demand for automobiles because they are pretty much vehicle agnostic, OEM agnostic and technology agnostic," he said.
"They obviously have the replacement market and the exports market. So whichever way you look at it, in terms of the big opportunity, the linear opportunity, or a diverse set of opportunities, auto components are a better way to play, from a bottom-up perspective as well as a good proxy for automobiles,” he added.
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