Any knee-jerk reaction in stock market will be an opportunity to buy in, says Marcellus' Pramod Gubbi

He believes the impact of second COVID wave on the markets will be short-lived. “We have seen this over the last 12 months where we didn’t have any sight of the vaccine and we have very little clue about this virus itself and yet we are significantly better off as far as the market is concerned,” he mentioned.

“The markets will react to possible newsflow in the short-term, we will have to wait and see how this pans out. The COVID-19 cases rising are clearly worrying. Restrictions on normal economic activity will have an impact on corporate earnings and therefore markets,” he said.

“We need to look at it a little more positively here. The development of the vaccine is clearly a positive news. It is just a matter of implementation and the speed of implementation here,” he added.

He sees short-term blips in the market. “There would be short-term blips if we go down into a lockdown now. I don’t think it will be the same severe lockdown that we saw but even in terms of certain restrictions and certain activities would mean that certain sectors would face those short-term hits,” he said.

“However, broadly, given the way the economy is recovering, we should expect corporate earnings should be much better in 2022 and 2023,” he shared.

On Asian Paints, he mentioned, “We are watching this space very closely. We continue to be happy holders.”

In terms of private sector banks, he said, “We continue to prefer HDFC Bank and Kotak Mahindra Bank amongst the lenders.”

According to him, diagnostic space as a whole will do well.

“It is a large sector, there is space for more than one winner out here. This is a sector with significant large share of unorganized players. In our assessment Dr Lal Pathlabs has built the best sustainable comparative advantages here. The growth runway is pretty large, the demand dynamics are pretty benign. Our assessment suggested Dr Lal Pathlabs and we have been holding it for quite some time and continue to hold it,” he pointed out.