Teresa Barger, the co-founder and CEO of Cartica Capital, shared her views and outlook on markets and election results 2019.
“What I am really interested in is the Indian investors that have been on the sidelines, whether they have the confidence to come back in the market and particularly in the smallcap and midcap space,” she said.
“Foreign investors certainly will take heart from a fairly large National Democratic Alliance (NDA) victory. I think I am more interested in what the domestics are going to do,” she added.
“To the extent that the new government can move right away on the non-banking financial companies (NBFC) front and we can get a little bit of calm and some of that pricing action absorbed by the market in this critical auto and two-wheeler sector then I think we can get back to normal and then we can see the reversion to the mean on this midcap and play out over the rest of the year,” said Barger.
On the investment front, Barger said, “We ourselves have already invested in financials. We are in financials with very good asset liability management. Looking forward, we are interested in stocks that play to the big domestic market and whose competitors are the unorganised sector that is going to be affected by goods and services tax (GST) as they are coming to the tax net. So we are very much in favour of these listed companies who are per se formal and tax compliant, whose competitors are going to be going through a tough time. So that is what we favour."
Talking about the market outlook, Barger said, “I think it is possible for India to go higher because this has been such a narrow rally, there is an opportunity to broaden the number of companies that are participating in performance in the stock market going forward and that is what I would look to stay for the rest of the year,” Barger said.