Post GDP shocker, which sectors should you bet on? Here’s what Nitin Raheja has to say

economictimes.indiatimes.com:

Nitin Raheja, Executive Director and Head of Discretionary Equities, Julius Baer Wealth Advisors, says after the Q2 GDP shocker, capex spending which has been just 25% of the budgeted amount should probably come into play over the next two quarters and the industrial pack, the infrastructure companies, the cement companies could start to gain more traction. That could be the contract trade to play because it is very difficult to bring consumption back on stream as fast.
What is your view on some of these new exciting themes, green, clean, which will make companies very efficient in terms of energy dependency? Is it good to be in a green & clean theme?
Nitin Raheja: The road ahead is going to be good for the kind of investment that is going into green energy and within that in solar and wind. My only concern is the kind of valuations that are currently existing in some of these stocks. Let us not forget that while these businesses are doing well, when you talk about things like solar panels, they are essentially commoditised businesses. Currently, thanks to tariff barriers that have been put in place by the US on China, we are seeing an opportunity for Indian exports. Now, that is good and that means that Indian companies should do well over the next few years.

However, for a business where there are artificial tariff barriers, even with all the growth factored in, what is the kind of valuation that you should land up paying? That is my major concern. Today the market is rewarding them with sky-high multiples, which