Rahul Singh, director of investments (CIO) -actions at Tata Mutual Fund, said Wednesday that part of this coal shortage problem is seasonal in nature.
“Some of it is seasonal (problem of coal shortage). This happens every year from September to October. This time, it is accentuated because we had a strong recovery in demand in the first half of the year; Obviously, from a low base, but demand for electricity nonetheless increased in the first half of the year and growth in demand for electricity is expected to continue to be high over the next 2-3 month. So this leads to a so-called coal crisis, ”Singh said in an interview with CNBC-TV18.
When it comes to investment opportunities, Singh believes there are cyclical pockets where industry recoveries are still underestimated.
“In the automotive industry, we saw a small rally, but the banks are still lagging behind,” he explained.
According to Tata MF’s CIO, IT looks good in the medium term.
“The momentum in terms of business prospects, deals and transaction activity that is there indicates what we have heard from all the companies. So there is nothing new there and nothing is changing.” , Singh said.
Consolidation cannot be ruled out in the sector, however.
“Valuations have gone up a bit and mid caps are trading at higher valuations than large caps and this is traditionally a point where the industry takes a break,” he explained.
Singh believes the pressures on IT company margins due to attrition will subside over 6 to 9 months.
For the full interview, watch the video
(Edited by : Abhishek Jha)