Kotak Secs sees Sensex trading at 18K by FY09-end

Q: What is your call on liquidity then in that particular scenario. Are we heading into a very important policy meet at the end of this month as earnings unfold? Do you think that interest will start returning to markets like India at these valuations or do you think that it will refrain once with the kind of global uncertainty that still persists?

A: I still think liquidity will elude us in the next one quarter. It is nothing very peculiar to ask but the international scene seems to be slowly settling down. On the security front, one cannot be very sure about it, but one has to see this quarter pass by before it comes to a point where liquidity becomes more clearer. You will see more liquidity flow from July to September quarter, when actually two things would happen. By that time the international scene would have better settled and Indian valuations would also have factored in the two quarters numbers. Hence it would look more attractive.

Q: What is the range you are looking at for the index as one of the benchmarks and at the moment are you a net buyer or seller in heavyweights?

A: We are looking at about 18,000 for the index by going into the January-March next year.

Whether I would be a buyer or seller is a very difficult question to answer because of the uncertainty and non-clarity in the market especially with two-three large factors. One is inflation numbers, while two is uncertainty and non-clarity about the quarter numbers. There are definitely companies within that which analysts now are tracking and are comfortable with especially because of the fact that some of these companies need clarity of earnings and are trading at P/Es which are reasonable. Hence the margin of safety is higher there. So, rather than saying that we are net buyers or sellers at this while, you would always tend to pick and chose those stocks which look attractive.