The current rally in the market is fuelled on the expectation that there will soon be a coronavirus vaccine and a cure for COVID-19, said Geosphere Capital Management’s Arvind Sanger on CNBC-TV18 . Sharing his views and outlook on markets, Sanger said that he remains cautious, constructive on certain sectors but not as broadly bullish as the market seems to be.
“There will be an increase in pent-up demand going ahead in the auto sector,” he told CNBC-TV18 .
On the financial sector, Sanger said that “there are going to be massive bankruptcies” and therefore, “throwing money at the overall market irrespective and buying all the laggards is certainly not the strategy right now.”
Two-wheeler or tractor sales as well as FMCG companies are expected to benefit from the government stimulus, said Sanger.
“Overall rural has less popular density, easier distancing and less of an impact plus there is more liquidity injection by the government, therefore, companies that provide either two-wheelers or tractors or financing to rural India or certain FMCG companies with larger rural exposures could certainly be winners,” he said.
Furthermore, IT stocks are in favourable position, according to Sanger, who said that work-from-home trend has erased barriers and it is a trend that could be very powerful in the coming quarters.
“IT names could see massive tailwind. Work-from-home certainly removes the barriers to offshoring and outsourcing in a much more dramatic way,” he added.
Watch the video for the full report
