Occasional correction is a good thing for the market because it brings some semblance of sense back, said Hiren Ved, CEO, Director, and CIO at Alchemy Capital Management, in an interview with CNBC-TV18.
“We continue to be very constructive on the broader market,” he added.
“As the economy recovers from the pandemic blow, I believe that the breadth of the market will improve and it will be here to stay,” he said.
According to him, there is an opportunity in certain sectors like IT services, speciality chemicals and a few select pharma companies. These are likely to do reasonably well.
“Also, select auto companies, auto ancillaries, capital goods are likely to do reasonably well,” he shared.
He believes that India is in the middle of a commodity supercycle. “As the global economies recover, there should be a reasonably good demand shift. There is also pressure on raw material prices. Commodity cycles don’t move in one line, so there will be odd occasions where prices will be softer and the stocks will also react accordingly. Longer-term, our belief is that we are genuinely in a commodity supercycle,” he stated.
“We are just seeing the start of it,” he further added.
On non-banking financial companies (NBFCs) and housing finance companies (HFCs), he mentioned, “NBFCs had a great run in the previous decade. There are brighter days ahead for NBFCs but it is likely to be a very select club of few companies that will do very well. Even housing finance companies (HFCs) will do well. The sector remains fairly attractive for long-term investors.”
For the full interview, watch the accompanying video.