Low crude prices, low inflation, interest rates which are heading lower, very strong current account balances, fiscal which has been extremely well managed, that is, you should commend the government for being extremely responsible with the fiscal, and the structure is in place, all of that means that the macro for India is extremely strong, says Rajesh Bhatia, CIO, ITI MF.The market rally, of late, has been nothing short of spectacular. What has led to the rally and will it sustain; forget about going higher, but will it sustain at these levels?Rajesh Bhatia: It has been a phenomenal rally and quite unexpected given the challenges that we were facing probably in September. Even though not much money has been made since the September top, I mean it is extraordinary how strong our markets are. Look, what has happened is that India is still looking like an oasis in a world which is extremely troubled. India does not have macro challenges. You look at the US, Europe, China, Japan everybody has significant macro challenges to navigate. India, on the other hand, is still going to emerge as the fastest growing economy in the world with the least macro challenges. In fact, I would say, our macros are extremely strong. Low crude prices, low inflation, interest rates which are heading lower, very strong current account balances, fiscal which has been extremely well managed, that is, you should commend the government for being extremely responsible with the fiscal, and the structure is in place, all of that means that the macro for India is extremely strong. It becomes one of the better markets in a world which is navigating the uncertainty of tariffs and the Trump economic policies. India stands out with only 2% exposure to US trade as a percentage of GDP, India definitely does stand out as a very attractive market. So, I would say yes, left to our own devices minus the global challenges that all equity markets will face, India is actually in a very-very strong footing. So, analyse the earnings for us. Let us look at the markets a little bit more myopically. What is the analysis? Where do you think lies the strength and the weaknesses?Rajesh Bhatia: Well, that is a good point because one of the challenges why did we top out? We topped out because the outlook for earnings growth rates definitely softened with the government expenditure which was the key driver of GDP slowing down, the outlook for earnings definitely came down. Now, look margins have actually gone up very well in the last few years. Profits to GDP are at about 6% which is one of the highest that we have seen in a long time for India, I think the all-time high was 7% or 8%. So, we are in a very good profit to GDP trajectory. Even margins are high. So, for earnings to kind of move ahead from here on you require topline growth; translation, you require GDP growth rate and our GDP growth unfortunately today is less than 10%, the nominal GDP growth rate is less than 10% and that is really where the challenge has come in. We have very-very strong bank balance sheets and they are all willing to lend. The credit cycle usually starts when there is opportunity for the balance sheets of banks to start lending, not the other way around, not when there is demand for credit, but rather when there is an opportunity to lend. So, the balance sheets are strong, interest rates are coming down, I think the credit cycle will begin again and that will mean the GDP of the country will accelerate and that could translate into further earnings growth as we move forward. Like I said, left to our own devices, we would be very-very strong market, but there are global challenges to contend with. So, believe that financials as a space you like on the back of the credit cycle uptake is what you are forecasting, but other than that which are the other sectors that you like at this point in time?Rajesh Bhatia: So, I will just make a nuanced argument there on financials. We have liked financials quite a lot, although I have taken some money off the table, that is because what is happening is you are going to see a consolidation of profits at least for large private sector banks in the current financial year. If interest rates come down, what happens is their asset book is really getting repriced lower. They will adjust over a period of time with their deposit costs also kind of coming down, but the profit growth will be probably muted, I would say, in the current financial year only to accelerate next financial year. So, my sense is given how well financials have done, they are the only conspicuous sector which is at a new high. My sense is that you should lower your expectations on certain private sector bank. To answer your question, I am very excited about telecommunications, life insurance companies, utilities, digital businesses, so on and so forth. And like I pointed out with the improving credit trajectory, consumer discretionary like automobiles or some other consumer discretionary items are also emerging as buy themes for me.