Good time to enter quality stocks: SSKI

But he asserts that fundamentals are still strong and finds this weakness in markets an opportunity to get into quality stocks. He gives his picks among the stocks that have undergone correction.

His pick from the metal sector is Hindalco Industries, with a three-six months perspective. 

Excerpts from CNBC-TV18's exclusive interview with Hemang Jani:

Q: 11713 for the Sensex and 151-point decline for the Nifty. Is most of it out of this system or is there still a lot more to come?

A: The way the markets have been behaving for the last three-four days, it has unnerved a lot of players and in the short run, it would be extremely difficult to predict where the market would settle. I would rather see it settling down and then form a view because going down by 400 points, moving up by another 350-400 points and then again going down is too erratic and it makes preempting the levels extremely difficult. I would want to wait for couple of days and let the dust settle down and then form a view. Right now, it is better to stay away from the market from a purely short-term perspective.

Q: How are you looking at the fundamental aspects of it and what is your take on the flows? Do you think this is just a temporary blip and we will be back on course as soon as the commodities around the globe are back on course?

A: Fundamentals are absolutely intact. If one looks at the numbers, most of them have surpassed expectations. Even if one looks at the flows into the emerging markets, the latest figures show that they are good. Metals have started correcting and emerging markets are more vulnerable to these kinds of movements, along with the flows the crude prices etc. So till we have some stability, one could see this kind of an up and down in the market.

But fundamentals definitely remain strong and we think that this kind of a weakness in the overall market gives one an opportunity to get into some good quality stocks. Particularly in the cash market, a lot of good stocks are available at much attractive valuations. So we are advising some of our clients to get into these stocks that have one-year kind of perspective.

Q: Can you give us a couple of stocks that you are looking at in this downturn?

A: Sundaram Clayton , in the auto ancillary space, is available at about Rs 9 PE and is sitting on a huge investment. So we like Sundaram Clayton, SKF India , Subros , Elder Pharmaceuticals  and Saregama India  are the stocks that we like a lot. Some of them have corrected quite a bit in the last one-week or so and we think that it is a right time to get into these stocks.

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