What are the stocks or sectors one should look at in a volatile market?
Among sectors, infrastructure, utilities and aviation should do well over the medium- to long-term. Among utilities, telecom would be the preferred pick given the strong growth in subscriber base over the next couple of years. Aviation sector is a contra bet as the sector is going through a consolidation phase which would result in better pricing power. Also, falling crude prices would benefit the sector as fuel prices account for a disproportionately high percentage of revenues. The financial sector should also do well over the longer run as India is an under-penetrated market and less than 2 per cent of India’s population is actively involved in the equity markets. What’s your view on the rupee depreciation? One of the major reasons for the rupee depreciation was high crude oil prices, high inflation and the US subprime crisis. Adding to this was the US dollar appreciating by 12-I5 per cent against all the major currencies during this period. We see the rupee consolidating at current
