Sridhar Sivaram, investment director at Enam Holdings is of the view that if the current market rally becomes broad-based then it will have more legs and the probability of that seems to be high because across the board the earnings have been good.
Speaking to CNBC-TV18 about reasons behind the recent rally in stocks, Sivaram said. “We have got a fiscal stimulus which has gone unnoticed.”
Talking on the banking space, he said the house has been bullish on the corporate banks for six months but it did not work. However, they remain bullish on them due to IBC/NCLT process.
The house also have been upbeat on the large PSU corporate banks.
"So selectively, there is an opportunity for money to be made because their valuations are lower even then their long-term averages. In general, the demand outlook has been much stronger and so in this kind of environment the corporate banks flourish when the economy is doing well," said Sivaram.
According to him, there is currently more spending power in the hands of consumers. “In general, when you have a price war, you are better off being a consumer than a minority shareholder,” he said.
Sivaram said the demand for cement also continues and are upbeat on the space although valuations are of concern. Both the cement and steel companies are coming back with positive news and are saying they are being caught unawares by the strong demand.