Neutral on auto, pharma, slightly overweight on metals: MOFSL’s Gautam Duggad

“In autos, we have M&M and Motherson Sumi in our model portfolio,” he shared.

He is more worried about how the demand shapes up once the economy opens up. “At the moment, the important point to note is the lockdown restrictions have continued for two months and there are indications that even in June the restriction easing will be gradual and calibrated. You might see a month or two of pent-up demand recovery but it is not going to continue for five-six months,” he said.

Autos, consumer durables are the sectors, which will be impacted by commodity price inflation.

“There is still a lot of room left as far as earnings are concerned in some of the steel stocks,” he stated.

The global commodity upcycle is in full swing. “In the last five-six months we have seen that prices have gone higher and in the last one week also, some prices have cooled off a bit 10-20 percent. But there is still much higher on a quarter-on-quarter (QoQ) and a year-on-year (YoY) basis. We have no view on where the commodity prices will go – up or down. We will just watch it as it moves,” he shared.

“Names like Britannia, Hindustan Unilever Ltd (HUL), Pidilite Industries, Titan Company, Tata Consumer have been our favourite for a very long period of time,” he mentioned.