FMCG is a good sector to be in India: Dhiraj Agarwal, Standard Chartered Capital Markets

Dhiraj Agarwal, Director, Institutional Equities, Standard Chartered Capital Markets,in an interview with ET Now talks about global liquidity

Your thoughts on PFC FPO and at a time when global liquidity is tight government FPOs how will the liquidity equilibrium change for them?



PFC specifically I do not have a view. We do not cover. In the environment of tighter global liquidity I do not think the liquidity is so tight that attractively priced FPOs of good companies will not sell. So it is not that we are in a global liquidity freeze environment it is only that the investors have become very very selective. So if its sort of frothily priced or if it is not a great business it will have difficulties in selling but if it is attractively priced I think it will sell. There is still long term belief in the India story so it will all finally boil down to valuations.



Are there any FMCG names that you like because sure enough the valuations are looking a little rich at this point in time but the point being that they are the once who are only being able to or rather who have the pricing power with them?


I think for long term FMCG is a good sector to be in India. The consumption story will continue to remain strong and one key feature of all FMCG results which have come this quarter so far is that the top line growth is extremely healthy, extremely strong which shows that how the consumption is growing at the grassroots level which is one thing which we might see in HUL results also today that the top line will be decent while the bottom line might be slightly weak. So we like the sector, we like the sector from a long term point of view. Yes, it will not be giving a spectacular short term returns but it will give fairly decent long term compounded returns.