Sanju Verma sees Sensex at 22K by Mar 2013, suggests bets

In an interview to CNBC-TV18, Sanju Verma of Violet Arch Capital Advisors says she is not cautious as yet. "We are looking at the market inching towards our fiscal year-end target of 22,000 by end of March 2013," she adds.

According to her, market is bullish on metal stocks on the back of firm demand, and pricing.  She likes SAIL among the metal stocks. "It is a good bet with one-year horizon. I expect 20-30 percent returns from the stock over the next 12-18 months," she elaborates.

She also likes JSW Steel . But, she says, regulatory bottlenecks is the key concern.

In capital goods segment, L&T continues to be her preferred bet. She is advising her clients to look at Crompton with a mid-term view.

She further says new NBFC norms are not likely to impact Shriram Transport . "It is our top bet in the NBFC space," she asserts.
 
As far as IT sector is concerned, KPIT Cummins and Hexaware are her top midcap picks. "Midcap IT stocks may take time to outperform," she adds.

Commenting on the macros situation, Verma says inflation is trending downwards. "RBI may ease in January policy," she adds.

Expert view: Trading tips on 7 stocks; 2 multibaggers

Below is the edited transcript of her interview with CNBC-TV18`s Mitali Mukherjee and Sonia Shenoy.

Q: Is this an opportunity to buy into the dip after Friday’s cut or are you getting a bit cautious on trade?

A: We are not cautious as yet. We are looking at the market inching towards our fiscal year-end target of 22,000 by end of March 2013. Given that we have rallied 20 percent plus in dollar terms this calendar year, having roped in more than USD 21 billion by way of FII flows, one easily starts thinking that maybe the liquidity driven rally has run its course, so has the valuation based rally The market, on trailing earnings, is not looking cheap. Assuming an EPS of Rs 1,400 for FY14, the market is trading at about 15.5-16 times, mid-cycle valuations.

I think the second quarter FY13 numbers clearly told one story. While top-line growth may have come down from 20 percent plus, which we have been used to seeing over the last one year to a dismal 14 percent, the more important and optimistic scenario was thrown up at the EBITDA level.