Andrew Holland said that the firm is long on the market even if there is skepticism in terms of liquidity. “But I will wait for a correction in the market and that will happen for sure”.
Another factor to watch out for the market is to see how India manages to make its fiscal deficit stats better. The rise in crude oil prices has made him worry about that.
Global risks more than earnings in India could be the ones to watch for. “Interest rates are rising globally. Any kind of turmoil in the global markets because of that will hit emerging market bonds”. The oil price surge and rupee moves could be the risks for the next few months.
Even as the government hints at cutting GST rates on some items, he said that there is a lot of confusion around the taxation regime. In fact, he does not foresee any V-shaped recovery as demand is still low due to the tax’s impact.
On a sectoral basis, Holland continues to remain negative on the IT sector on the fundamental front. Even with a weaker rupee, there could be some good moves, but there is still a lot of pain ahead.
He is bullish on the FMCG space as GST is set to give it a great level-playing field and he sees a scope for a lot of margin improvement.