Rahul Singh, CIO-Equities at Tata Mutual Fund expects to see a mixed response by the market to the lockdown. “This time the expectation is of much swifter recovery for the economy and general consumption,” he said.
He believes the coronavirus is likely to stay with us for a much longer period than what was thought in January, February. “That realisation is very important for the market and therefore you may not see a significant reaction in the market as a whole but clearly between the various segments of the market, there will be further realignments. We will see much more stock-specific movements in this fall or in this consolidated phase,” he mentioned.
According to him, the IT and pharma sectors have become more important. “These two sectors have done well and it is just not only because of exports,” he said.
On the financial sector, he stated, “Some private banks are still at reasonable valuations and they have shown their systems and processes they have in the last one year that has been tested and they have come out good. So I don’t see the same amount of reaction across the board.”
In terms of insurance category, he pointed out, “Post such pandemics, life insurance and term insurance tend to pick up. In India that will happen maybe with a lag. From a compounding perspective, both life and general insurance space is still under-penetrated.”
For the entire interview, watch the video