Dalal Street Voice: 7 engines of PM Gati Shakti plan likely to benefit cement sector, says Vaibhav Agrawal of TejiMandi

I will be bullish on the cement sector considering the newly introduced seven pillars of the Gati Shakti plan, Vaibhav Agrawal, CIO, TejiMandi said in an interview with Zeebiz’s Kshitij Anand.

Agrawal is a seasoned professional with over a decade of expertise in stock picking and generating index-beating returns. Mentored by the aficionado of investors, Raamdeo Agrawal, Vaibhav has developed a distinct investment philosophy.

India should be in an upcycle for the next 3-5 years and is the world's fastest-growing economy. Hence sooner or later, FIIs should be buyers in India, he said.

Edited excerpts:

Q) On a scale of 1-5 – how to you rate the overall Budget and why? (5 being the best)

A) I would rate the budget at 4 out of 5. The government continued its pro-growth stance and is clearly of the opinion that reviving the investment cycle is important for economic growth and job creation.

Moreover, it was a comprehensive approach by the finance ministry that addressed almost every possible industry.

Q) Where do you see markets headed post Budget 2022? What will be a bigger driving force – US Fed or Budget allocations?

A) Markets should be on an upward trajectory. The government has clearly focused on providing an impetus to the investment and industrial cycle, and this should create a multiplier effect.

The US Fed may cause markets to remain choppy, but budget allocations will drive fundamental economic growth ahead.

Q) How do you see the government managing its fiscal math?

A) The government's estimates of tax receipts and GDP growth is quite conservative. Hence, the fiscal deficit number could actually be much better than what the government is projecting.

Q) Which sectors are likely to benefit the most from Budget 2022 and why?

A) I will be bullish on the cement sector considering the newly introduced seven pillars of the Gati Shakti plan - Roads, Railways, Airports, Ports, Mass Transport, Waterways, and Logistics Infrastructure, which should boost the cement demand in the future.

Also, I see the growth in the Infrastructure sector as the government has focused on Capex and infrastructure growth.

Q) Any announcement you thought it stood out from the Budget speech or document?

A) The Gati Shakti plan is something that stood out as the government formally identified the pillars of infrastructure growth.

Q) How do you see the renewable space in the year 2022 post Budget announcements? 

A) Renewables will be a massive area of focus of the government. As India's commitment to the global climate change summit, electric vehicles, solar power, and other alternative sources of energy will play a key role.

Hence participants in these segments would receive incentives from the government. Many PLI schemes have also been announced in this segment.

Q) What is your take on December quarter earnings so far?

A) December quarter earnings have been encouraging. They have been indicating a strong underlying economic growth, albeit with some raw material and energy price inflation. The Indian equity market is restoring and recovering rapidly post 3rd wave of COVID.

Q) FIIs have remained net sellers in the last 3 months at least in the cash segment and January is no different. What is the likely trend – in light of the hike in US Fed rates?

A) FIIs may have been net sellers in the last couple of months, accentuated by the hike in the US Fed interest rates. However, as highlighted by the budget math and economic survey, economic growth in India is robust.

India should be on an upcycle for the next 3-5 years and is the world's fastest-growing economy. Hence sooner or later, FIIs should be buyers in India.

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)