Buy banking, infra, telecom frontliners: Angel Broking

Excerpts from Midcap Radar on CNBC-TV18 Watch the full show » ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets Bharti Airtel BSE | NSE 25/05/12 Are Mutual Funds betting on Bharti Airtel? Other Stocks in this news Reliance Communications |

P Phani Sekhar, Fund Manager, Angel Broking, advises investors to invest in frontliners from banking, infrastructure, and telecom space. "At this point in time, we are asking our investors to look at Nifty stocks and avoid metals. We advise selective exposure to equities. Although, a great amount of value has emerged in equities, we still advise our investors not to go all out and start investing at this point in time. We are urging them to start putting in 10-15% of what they want to invest in a very systematic way because we do not have a handle on where the near-term will take us.

 

According to Sekhar, the markets may bounce more than 7-9% from hereon. "Under normal circumstances, we would have expected 15-20% of bounce. But looking at the kind of incessant selling and the momentum, we would be hesitant to give anything more than 7-9% from hereon."

Here is a verbatim transcript of the exclusive interview with Phani Shekar on CNBC-TV18. Also watch the accompanying video.  

Q: Would you say that we have seen the bottom. Even if we do not recover in a long time that at least in terms of price, the worst is over?

 

A: It's very difficult to say. The sheer momentum of selling on Friday had taken everyone by surprise. No levels in such situations hold any sanctity. We may retest 2250 again but we might recover as well. So we are fairly open to the fact that we might stay here or go back to the bottom and that is what is dictating an asset allocation at this point in time.  

 

Q: What is your asset allocation at this point in time?

 

A: We advise selective exposure to equities. Although, a great amount of value has emerged in equities, we still advise our investors not to go all out and start investing at this point in time. We are urging them to start putting in 10-15% of what they want to invest in a very systematic way because we do not have a handle on where the near-term will take us.

 

Q: What do you ask them buy?

 

A: Largecaps. At this point in time we are asking our investors to look at Nifty stocks and avoid metals.

 

Q: What is the kind of cash position people have across funds right now? Do you think in the last sell-off that we witnessed Friday, Monday some of the deployment did happen?

 

A: The cash position has increased by around 4-6% as far as domestic institutional investors and portfolio management schemes (PMSs) are concerned.

 

Q: How much would you give this current bounce that we saw over the last 48-hours, the big stocks are still holding out despite it being an expiry week and expiry day. The FTSE has opened a handy 5% higher at this point in time, CACE and the DAX also decently higher would all this mean that after we see through this F&O pain, there maybe a bit of a trading rally here?

 

A: Under normal circumstances, we would have expected 15-20% of bounce. But looking at the kind of incessant selling and the momentum, we would be hesitant to give anything more than 7-9% from hereon.

 

Q: What are the sectors that you essentially would be looking at buying into if the market gave you another opportunity?

 

A: Even at these levels, we are asking investors to look at largecap names and banking, infrastructure and maybe selectively telecom.

 

Q: Reliance Communications ?

 

A: Bharti Airtel .