Renewable energy is going to be a huge market in India, said Randy Watts, chief investment officer (CIO) at O'Neil Global Advisors, on Tuesday.
Speaking in an interview with CNBC-TV18, he said, “We think renewable energy is going to be a huge market in India. Electricity demand continues to grow rapidly. Reliance Industries is moving there and we like Adani Power as well, we also like Tata Power. So, it’s an area where there is going to be a rapid transformation over the next 20 years.”
According to him, the economic picture for India a few months down the line will look much better. “The government is looking for ways to stimulate the economy without giving too much stimulus. I think some of the credit guarantees etc., are one-way; down the road, another way they may help in the financial sector is by creating bad banks as the non-performing loans have risen for quite a few Indian banks and the government will want to clear it,” said Watts.
On small midcaps stocks doing better than largecap stocks, Watts reasons that when investors are optimistic about the economy, they tend to migrate to more cyclical and smaller stocks.
On sectors, he said, “We still like healthcare space and in that we like Laurus Labs, Apollo Hospitals Enterprises. We like some of the companies that provide the ingredients for pharmaceutical manufacturing like Vinati Organics.”
“In general, we do still like growth stocks. There are some elements of cyclical that we like, but we do still like growth until certain areas get going again; obviously, autos have been slower and the monthly numbers have been disappointing. The estimates I have seen say that they are hoping the industry can get back to about 70-75 percent of normal in June, but for a lot of those stocks, I think we want to see a bit of firming before we start to go more cyclical. So, we do still favour growth,” Watts said.
Disclosure: Network 18, which publishes cnbctv18.com, is a part of the Reliance Group.
For the entire interview, watch the video
(Edited by : Dipika Ghosh)
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