There are no negative factors for the Indian equity market from a 1-2-year perspective, said S Krishna Kumar, CIO - Equity, Sundaram MF, adding that this is a good time to be invested in stocks.
“Lot of data has been coming through pointing towards softness but at the same time, these are all data points which are past and so nothing much is very negative from a 1-2 year perspective,” Kumar said in an interview with CNBC-TV18.
“It is a good time for investors to stay positive and be invested in markets. One will see 1-2 quarters of soft growth given that we just came off the consumer slowdown triggered by NBFCs and we still are in the process of resolving some of the liquidity issues and interest rates,” he added.
Talking about the upcoming Union Budget, Kumar said, "The government had earlier promised to lower corporate tax and rationalising goods and service tax (GST) and so one would look for those directions in the upcoming budget."
When asked about the rural slowdown and its impact on FMCG earnings in the near-term, he said it is unlikely that weak monsoon would have a significant impact on the rural income as such because, besides agriculture, there are other sources of income in the rural regions.
“Overall market is looking at valuations in the space and relatively to other cyclical spaces in the Indian economy where there is lot more comfort. There is rebalancing of portfolios that is happening over the last three months and so stocks are soft and have been throwing up negative returns over 3-6 months. So, this FMCG de-rating has been ongoing and is a bit current situation,” he said.
In terms of themes that could be good investment bets, Kumar said sectors like cement, steel, infra, capital goods are good. "The capacity utilisation levels in different parts of the economy are far better and there is enough business optimism for companies to plan capacities for the next few years."