homemarket NewsWith rate hike possibility rising, Andrew Holland says domestic consumption theme stocks worth exploring
With rate hike possibility rising, Andrew Holland says domestic consumption theme stocks worth exploring
In an interview with CNBC-TV18, Andrew Holland, CEO of Avendus Capital Alternate Strategies said that the domestic consumption theme, particularly travel and hotels, are areas worth considering. Despite the COVID-19 pandemic's impact on the travel industry, he said that it’s a resilient industry and will recover in due time.
The Reserve Bank of India (RBI) may be forced to maintain higher interest rates for a more extended period due to inflationary pressures. This could have implications for investors, as higher interest rates tend to decrease demand for equities.
In an interview with CNBC-TV18, Andrew Holland, CEO of Avendus Capital Alternate Strategies said that the domestic consumption theme, particularly travel and hotels, are areas worth considering. Despite the COVID-19 pandemic's impact on the travel industry, he said that it’s a resilient industry and will recover in due time.
He said, “The RBI in April might go higher and stay there for longer, which is not great for our growth, and probably would mean an earnings revision, at least for the first half of the year.”
Talking about domestic consumption themes, he said, “The whole domestic consumption theme in terms of travel, hotels, are themes we have talked about before and I just can't move away from them to try and find anything more exciting now.”
“I don't think we should just follow this rotational kind of market around in the next few months; just stick to where the short to medium-term themes are going to play out over the next few years. So that is where we are concentrating our minds and bets because that is the best place to be,” Holland added.
On investment themes, Holland advised investors to stick to investment themes that will work despite interest rate movements. He suggests focusing on themes such as defence and renewables, which are currently in a global investment cycle.
Holland also noted that there is currently no catalyst for the Indian market, and the first half of the year is likely to be slow. However, he expects a recovery in the second half of the year. This could be good news for investors, as it may provide an opportunity to buy into the market at a lower price.
Also Read | A new trend? Indian Hotels sees big opportunity in business travel being combined with leisure
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