Anup Maheshwari, Joint CEO & CIO at IIFL Asset Management Company, spoke to CNBC-TV18 about the current volatility in the equity markets and shares his outlook.
“Whenever liquidity is tight, interest rates are heading up it is bound to have some negative effect on the asset class. The consequence of that is that earnings do get downgraded eventually,” Maheshwari said on Thursday.
"However, these kind of corrections are good in terms of longer term profile of asset class and an opportunity for investors. One will have to make some changes in portfolios," he added.
Talking about the retail flows, Maheswari said, “For us it is different book of business where IIFL AMC is largely in alternate space where we about $4 billion book and therefore cannot give the exact impact of retail flows."
Regarding the auto space, he said, "All the companies will start guiding lower number because of macro headwinds which will impact consumption and therefore the auto sector. Moreover higher interest rate will also not help the space. So, it is logical to expect a slowdown in consumption but the longer-term theme does not change."
According to him, "Emerging markets are a very difficult place to be in especially with the way dollar is behaving and fiscal deficits are running but as markets calibrate downwards. We will reach a point where EMs will look too cheap relative to developed markets and then some value buying may emerge again."
Talking about expectations from the monetary policy tomorrow, Maheshwari said, "Consensus belief is for 25 basis points hike and market is not likely to take too much cue from the rate hike because it is clear where it is headed directionally. So 25 or 50 basis points will not make much of difference."
"The strongest pain points in the short-term are financials and consumption but private sectors banks both retail and corporate are a good place to be in. The house always had a soft spot for pharma and more so specialty chemicals," he said.
Have you signed up for Primo, our daily newsletter? It has all the stories and data on the market, business, economy and tech that you need to know.
First Published: Oct 4, 2018 11:04 AM IST
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
Gonda Lok Sabha election: BJP's Kirti Vardhan Singh takes on Beni Prasad Verma's granddaughter Shreya
May 19, 2024 10:19 PM
Faizabad Lok Sabha election: Can Ayodhya Ram Temple strengthen BJP's stronghold here?
May 19, 2024 10:16 PM
Amethi Lok Sabha election: Can BJP's Smriti Irani retain the Congress bastion she won in 2019?
May 19, 2024 10:12 PM
Rae Bareli Lok Sabha Election: Can Rahul hold on to this Gandhi family bastion?
May 19, 2024 10:09 PM