Valuations Compelling For FMCG Sector, Says Avendus’ Andrew Holland

With the rupee inching towards the 70 mark vis-a-vis the U.S. dollar, the information technology and fast-moving consumer goods sectors are the ones to bet on, said Andrew Holland, CEO of Avendus Capital Alternate Strategies.

“FMCG is a defensive sector, so you can hide there. Besides, all companies in the sector are growing well,” said Holland. "The long-term story for the sector is compelling.”

Highlights from the conversation:

On Markets And Earnings:

• Markets continue to ignore high valuations.
• Earnings season has been pretty okay.
• Nothing on the horizon which will get investors excited on the earnings front.

On The Rising Dollar:

• Could lead to more turmoil in the global markets.
• Seeing a lot of bond outflows from emerging markets such as Argentina, Brazil, Turkey and Indonesia.
• Can expect downside for the Indian markets.

Sectoral Picks:

• FMCG and IT.
• PSU banks likely to be hit on loss in market share and huge bond losses.
• Automobile sector is currently in a phase of consolidation.
• Not comfortable with oil marketing companies at current levels.