The correction seen in Indian stocks is an opportunity for investors to buy commodity stocks, Andrew Holland, chief executive officer at Avendus Capital, told BloombergQuint in an interview.
Global GDP growth will continue to pick up, pushing commodity prices higher next year, Holland said.
Here are the key takeaways from the conversation:
- The correction not a big surprise. The market is likely to head lower before it consolidates under the 10,000 mark.
- Upcoming Gujarat election results could lead to jitters in the market.
- Reserve Bank of India's announcement regarding public bank recapitalisation plan is not a positive for the sector.
- Only three to four banks will get properly recapitalised. Smaller inefficient banks will not benefit from the process.
- Fundamentally nothing has changed for pharmaceutical stocks, will continue to get “beaten black and blue” for a bit longer.
- Both U.S.-exposed and domestic pharma stocks are not compelling.
- Aviation story will continue to do well in the long term. There will be opportunities to buy in this sector.
- Theme for next year is that earnings growth is coming back. Look at sectors which may surprise on the upside. Aviation isn’t one of them.