Stocks to buy: Cyclicals could be a better play despite rece

Stocks to buy: Cyclicals could be a better play despite recent outperformance: Mukul Kochhar


What would be your preferred plays given that the environment is shifting?
In the last three or four months, we have been very constructive on financials and part of the reason is that even as Covid hit, the financial sector had consolidated quite a bit. Corporate credit in the banking system has declined 10% in the last five to six years. That is a substantial amount of consolidation and speaks to the asset quality on the book of the banks and the financials. Even on the retail side, India is the least penetrated market in the world. So, both on the corporate and the retail side, there is no question of over leverage in the system and as we were coming out of this, IPO valuations were looking attractive and we were fairly constructive on the sector.

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