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    Positive on capital goods & mfg sector; avoid primary market: Roha Asset Managers

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    Positive on capital goods & mfg sector; avoid primary market: Roha Asset Managers

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    Dhiraj Sachdev, Managing Partner & CIO at Roha Asset Managers, is positive on manufacturing and capital goods because of the PLI scheme, anti-dumping duties. "We are putting our money in capital goods and manufacturing sector because their ROCE are at cyclical low and we believe that there could be a significant improvement in earnings and improvement in the capital employed of the invested assets."

    Dhiraj Sachdev, Managing Partner & CIO at Roha Asset Managers, is positive on manufacturing and capital goods because of the PLI scheme, anti-dumping duties. "We are putting our money in capital goods and manufacturing sector because their ROCE are at cyclical low and we believe that there could be a significant improvement in earnings and improvement in the capital employed of the invested assets."
    He said, “Apart from that, we are invested in tractors, we like speciality chemicals because of the continuous shift from China to India or China plus one strategy. They have demonstrated pretty scalable growth over the last few years and we believe that capex is happening in speciality chemicals.”
    On IT stocks, he said, “The COVID-19 pandemic has significantly accelerated the shift to digital. Many companies are yet to make the transition to a fully digital operating model, so this is a key positive. However, the substance of growth in the sector is still likely to remain modest in our view given that specific verticals like travel, aviation, retail may witness some IT budget cuts, so we need to be really careful or what kind of companies we are buying.”
    Talking about primary market, Sachdev said, “By and large, we are avoiding the primary market because we believe a large part of the IPO is getting to frenzy zone, the margin of safety is very limited because they are excessively priced.”
    For full interview, watch the accompanying video.
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