Pharma good for next 2-3 years; wait a quarter before entering IT: Abhishek Basumallick

Pharma and the IT sectors have been underdogs. IT is going through a downturn, but there are pockets of the market which say that it is a good bet for the long term. Similarly, for pharma, green shoots are visible. What is your take on these sectors?
If you can pick your spots, pharma is a good place to be in for the next two to three years. In IT, I would probably wait for another quarter. They are still not out of the woods. The US is still iffy. The problem with IT, especially IT services, is that until and unless there is very clear visibility of growth in the US market, the buyers or the clients do not tend to go and start giving new projects. They have always been cautious in giving out new projects. I would be a little bit hesitant to build up positions in IT services. But there are plays in the ER&D space within IT which definitely look good.

Let us talk about real estate now. You talked about how that space looks interesting and there is a case to be made to incrementally add positions there. Is there a micro market that you are tracking or a particular vertical because luxury sales have been doing well? Mumbai market has been booming; Bangalore rentals are skyrocketing. How are you picking realty stocks?
My personal take has always been to play the pick and shovels in the real estate space. So, go with the sanitaryware, the tiles, the pipe makers, the paints, those kinds of plays rather than go into specific real estate plays because of exactly the point you made, they are very micro market, very geography specific and unless you are very conversant with a particular geography.

Let us say you want to play the Mumbai market, unless you know the Mumbai market very well, it is very difficult to play that. But if you are playing it through say a paint maker or you are playing it through a sanitaryware, it is much more broad-based and they are supplying to most of the bigger players. So, I would prefer playing it through the ancillaries.