Don't chase IT, banks at these prices, cautions Envision's Nilesh Shah
One has to be a little careful on buying into IT, said Nilesh Shah, MD and CEO of Envision Capital in an interview with CNBC-TV18.
One has to be a little careful on buying into IT, said Nilesh Shah, MD and CEO of Envision Capital in an interview with CNBC-TV18.
“Purely from a fundamental perspective, we have seen the best of margins for the large cap IT and we have seen probably amongst the best of P/E multiples for the IT stocks,” he said.
“One has to be a little careful on buying into IT. However, if there is some kind of correction down the line, I think one needs to revisit the secular growth story of IT and be more focused on that and maybe then again there is a buying opportunity there but for now, one has to be careful on the large cap IT names,” he said.
“Margins were expanded and probably at multi-year high in Q2. Going forward, one should have tempered expectations around IT,” Shah said.
The current correction in Reliance Industries Ltd (RIL) presents a good long-term opportunity for investors, he said.
“Though in the short-term there could be volatility and there could be some kind of consolidation both timewise and pricewise, nevertheless I still believe that RIL represents a very strong proxy for India’s long-term growth potential,” he said.
According to him, the best is behind for some of these large banks. “One should be little careful. Banks have played the catch-up game, it will probably take them some time to now in a way move forward and grow their business. Once that happens, it is probably then it might be a good time to look at some of the larger private banks,” he said.
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Disclosure: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
(Edited by : Santosh Nair)
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