IT will outperform pharma and FMCG: Nilesh Shah

Within the defensive pack, IT should be able to outperform pharma and FMCG companies, says Nilesh Shah, MD, Kotak AMC. Edited excerpts from his interview with ET Now:

How do you think the second wave of Covid can impact financial stocks?
Undoubtedly, there are certain pockets in financial services like microfinance, commercial vehicle financing, unsecured personal loans, etc, which will get impacted far more adversely because of the second wave. One interesting observation from the last nine months is that banks have started providing for Covid-related costs in provisions. This has ensured that there is a reasonable built up of provisions in their balance sheets. So the balance sheets will be relatively better in terms of secured loans, auto loans, housing loans and large company loans.