The investments are likely to pick up after the Lok Sabha elections in 2019, said Nilesh Shah, managing director of Kotak Mahindra AMC, adding that one needs to be more optimistic on 2019.
"The hope is that one could see pick up in investments, which could lead to better momentum in the economy," he said.
On elections, Shah said that from a market point of view, it was "too early to build-in election outcomes, the momentum will build up in the next couple of months." “As of today market is pricing in a stable government. It wants a government that will pursue economic growth, which will push economy to higher level, so that corporate profitably will move up,” he said.
Shah said that the overall macros looked supportive for the market now, adding that 2018 was a tough year to make money "but if one were disciplined then one could have made money." "...first 9-10 months were difficult because oil prices were high, rupee depreciated, interest was up, IL&FS event happened...," he said.
Sector specific, the recapitalisation will help PSU banks pursue growth. They have the ability to capture market opportunity, he said, adding that there are lot of administrative challenges which make them a more cyclical investment rather than long-term investment.
Talking about the farm loan waiver or the basic income scheme for framers and its impact on money market, he said there is always a cost to be paid for fiscal profligacy.