As the Covid-19 pandemic disrupted economic activity and caused a washout in the last two months, companies likely to manage even flat revenue in the ongoing fiscal will command a premium in the stock market.
That's according to Ayaz Motiwala, senior fund manager of Amala Emerging Asia Fund at Nivalis Partners, who said companies that sell staples and basic necessities will see the most expenditure by consumers.
Companies which are able to maintain their revenue are likely to grow going ahead, he said in an interview with BloombergQuint. “There are very few growth stories around us right now.”
After basic staples, Motiwala said delivery companies and high-hygiene food chains are likely to pull through at a time when people are avoiding the outdoors and ordering food at home on the condition that its healthy.
At the end of the consumption chain are establishments which attract crowds, such as hotels, malls, multiplexes, etc. Given that consumers are restricted in terms of income and are also concerned about contracting the virus, these businesses will likely be the last to recover.
To be sure, any assessment cannot be made with certainty as consumer behaviour remains unsettled amid ambiguity, he said.
Watch the full conversation here:
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