Akash Prakash of Amansa Captial is bullish on banks and consumer discretionary stocks. He continues to like IT despite the fact that he sees short-term pain in the sector.
Veteran fund manager Akash Prakash of Amansa Capital sees Indian corporate earnings growing by over 20 percent compounded over the next 2-3 years. He believes the stock market will deliver similar growth.
He bases the expectation on low base, acceleration of the economy and the rupee trading at 63-65 per dollar, coupled with low commodity prices. “I am making an assumption that multiples will hold because interest rates are coming down, they may not expand. Bulls ofcourse will argue that multiples will expand. I would say do not assume that, assume multiples hold, earnings growth over the next 2-3 years will be 15-20 percent, so the markets should compound at that,” he told CNBC-TV18.
He is bullish on banks and consumer discretionary stocks. He continues to like IT despite the fact that he sees short-term pain in the sector.
Prakash believes the Reserve Bank (RBI) will lower interest rates a little later than what the market expects. He says governor Raghuram Rajan seems rather determined that the rate cut will be significant and hence sees a high probability of a 50 basis points rate cut in the first half of calendar year 2015.