CLSA sees no significant market rally in 2024, prefers to avoid this sector

Vikash Kumar Jain, India Strategist at CLSA, on January 11, shared his expectation on Indian equities for the year 2024 in a conversation with CNBC-TV18.

Jain said CLSA's portfolio strategy for the year does not factor in a runaway rally in the market like last year. The focus is now clearly on the risk-reward ratio with an aim to protect against potential downsides while exploring opportunities.

One notable aspect of CLSA's strategy is its underweight position on consumption. Jain said, "Our biggest out-of-consensus call is that we have zero weight in consumption, so pretty big underweight in consumption."

He said that while these are high-quality companies, the investing environment for them has changed, with a gradual de-rating process underway.

Jain said CLSA has avoided staples in its portfolio for the last three years except a few auto companies.

"I am not too hopeful because what needs to be done, and a lot of people are talking about consumption, I don't really sense the government changing its supply-side policymaking approach," he said talking about his expectation from the upcoming Union Budget.