homemarket Newsstocks NewsAmidst fear and sell off, one can look at these opportunities to invest in, says Sanjay Dutt of Quantum Securities
Amidst fear and sell-off, one can look at these opportunities to invest in, says Sanjay Dutt of Quantum Securities
Companies depending on Indian demand and supply situation, there will be an opportunity to buy in there if you haven’t bought earlier. Lot of local infrastructure plays because irrespective of how this whole thing pans out, aggressive government spend on infrastructure etc is not going to stop, said Sanjay Dutt, director of Quantum Securities.
Mark Matthews of Bank Julius Baer & Co when asked if investors should be prepared for two quarters of gross domestic product (GDP) cuts and earnings cut, said, “That depends on the progression of the virus and the response of government and central banks but at least Q1 is a wipe out and that was largely expected anyways."
"Chinese markets are the best performing markets in Asia this year notwithstanding this morning’s sell off – it is showing you that Chinese, where this thing started, they are already seeing through,” he added.
Speaking about Indian market, Matthews said, “There is no reason why India is any less immune to coronavirus than anyone else. It would be bad for a country like India. If you have adequate healthcare, serious cases can recover but if you don’t, unfortunately they will probably die. So that is why I would be concerned for India because obviously across the country, there are a lot of people who don’t have access to the kind of healthcare that you would need to treat a serious coronavirus case.”
Talking about investing opportunities Sanjay Dutt, director of Quantum Securities said, “A lot of India-centric plays – companies depending on Indian demand and supply situation, there will be an opportunity to buy in there if you haven’t bought earlier. Lot of local infrastructure plays because irrespective of how this whole thing pans out, the aggressive government spend on infrastructure etc is not going to stop."
"Similarly, some of the consumption plays, which were expensive earlier, you are getting them cheaper. So, start gradually building positions,” Dutt said.
On coronavirus issue, Dutt said, “My broader point is that it is something that none of us can game as to where exactly what is going to happen but I can say that companies like Larsen and Toubro (L&T), Asian Paints, Dabur India, Reliance Industries Ltd (RIL) are not going to shut down. So if you have got spare cash, you can start deploying it but deploy it gradually and not in one go. Keep watching because this virus is something which is going to have an impact for a quarter or two."
According to Dutt, "All the governments worldwide are cognisant of correcting this, no amount of monetary or fiscal stimulus will solve this problem. The only way this problem can be solved is to prevent it and to cure it and all the governments are now concerned about it and are at it. So it is a matter of few days that stock prices, markets will be pricing it in.”
“I think no amount of stimulus or fiscal or monetary is going to do much at this point of time till the panic and fear settles down in the financial market,” Dutt added.
In terms of sectoral analysis, Matthews said, “Consumption space would be the most obvious place where there is vulnerability and then there is healthcare because India is a big producer of generics and generally, drugs will become more interesting around the world as a result of virus.”
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