Rakesh Jhunjhunwala says Indian stock markets to continue growing, bullish on PSU banks, hospitals

Rakesh Jhunjhunwala continues to remain bullish on domestic stock markets even as Dalal Street, along with global peers, faces multiple headwinds. “I think the (domestic) stock markets will grow regardless of global developments,” Rakesh Jhunjhunwala told CNBC TV18 in an interview. Although he remains a proponent of Indian markets, he said that the pace at which Dalal Street will grow will be a tad bit slower. The big bull has cemented his position as a believer in India’s growth story with his new venture Akasa Air, entering the aviation space.

Big bull Rakesh Jhunjhunwala bets on PSU banks

The ace investor is one of the most vocal proponents when it comes to investing in India. Talking about spaces that he believes could do well going forward, Rakesh Jhunjhunwala said that PSU banks are his bet. “PSU Bank, PSU Bank, and PSU Banks are all that I’m very bullish on,” he said. Explaining his rationale behind the same, Jhunjhunwala said that he thinks credit will rise, and the consequence of that will be an increase in the pricing power of banks. “PSU banks have great power of gathering deposits,” he added. 

In his portfolio, Rakesh Jhunjhunwala holds Canara Bank stock worth around Rs 800 crore of 2%. Other financials that are in the big bull’s portfolio are private sector lender Federal Bank and Karur Vysya Bank.

Further, Rakesh Jhunjhunwala said that he is also bullish on the hospital sector. “Health is a very important element and if health insurance goes up then hospital utilisation will go up and it is difficult to run hospitals. I’m very bullish on hospital space,” he added. The big bull owned a 4.2% stake in Fortis Healthcare at the end of June 2022 and is also the promoter of Star Health and Allied Insurance Company.

Telecom sector not attractive for big bull

Discussing the digital revolution and the IT space, the billionaire investor said that digitisation bet us playing off. “I think the digitisation thing is playing off and as time progresses it will further (grow),” he said. Big bull also highlighted the role of Reliance Industries Chairman Mukesh Ambani in the digitisation trend saying that the low cost of communication that Jio has brought has aided the digital revolution in India.

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However, Jhunjhunwala said he would stay away from investing in the sector as it requires constant investment and there is no true cash generation. He, however, said that the IT services space will grow between 10-15% for the next five years. “The growth in IT services will not stop regardless of the recession,” he added.

Akasa Air is frugal not low-cost

He also explained his bet on the aviation sector saying that India will need 2.5 times the aircraft it has now as passengers grow from 14 crore now to 40 crore in the next four years, a prediction made by the Civil Aviation minister. Rakesh Jhunjhunwala believes that as incomes in India increase discretionary spending will go up and therefore aid in the growth of the sector. “I feel very confident about the Indian aviation story. I feel Akasa Air will be a very competitive airline,” he added.

Rakesh Jhunjhunwala also classified his airline as a frugal airline and not a low-cost airline. “We already brought a change in the aviation industry, our competitors are ordering new chairs in response to the chairs in our flights,” he said.