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Positive on financials & IT sector, cautious on consumer discretionary: HDFC Life’s Prasun Gajri

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Prasun Gajri, CEO at HDFC Life, talks about the fundamentals of the market. On earnings, Gajri said, “By and large the numbers have been met and in some cases, it has exceeded so there are more positive surprises than negative. So now we have two quarters where the earnings have been slightly better than anticipated that is clearly a good news.”

Prasun Gajri, CEO at HDFC Life, talks about the fundamentals of the market.
On earnings, Gajri said, “By and large the numbers have been met and in some cases, it has exceeded so there are more positive surprises than negative. So now we have two quarters where the earnings have been slightly better than anticipated that is clearly good news.”
“Not so good news is the fact that a lot of this earnings growth has still being driven on an aggregate basis margin expansions and not necessarily the topline growth. Topline growth is still struggling,” he said in an interview to CNBC-TV18.
On portfolio calls, he said, “We are bullish on financials, there the valuations have still not run-up that much. The worst of asset quality is behind and most of the top-rated financials are the better banks and even NBFCs are fairly well capitalised now. We feel comfortable with financials given the valuations and given the fact that with any kind of economic growth this sector is likely to do well with the credit growth incrementally likely to pick up next year."
“We continue to like IT, the only headwind is a little bit of rupee movement here and there but by and large the order books are looking very good.”
On the consumer discretionary sector, Gajri said, “We have been fairly positive for some time on the consumer discretionary sector but now we think the valuations have clearly run-up and one would want to be a little bit careful. That entire space has extremely well over the last 6-9 months and the numbers have surprised positively. But now given the valuations I would be a little bit wary.”
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