See Nifty downside at 4650 in next 2-3 months: Karvy

463 Investors following NMDC. Share this News with them.

0

Like this story, share it with millions of investors on M3

See Nifty downside at 4650 in next 2-3 months: Karvy

In an interview with CNBC-TV18, Ambareesh Baliga of Karvy Stock Broking, spoke about his market outlook.

Post your opinion here

 

0

Tweet

Share on Tumblr

Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Nifty quiet in early trade; tech, pharma, power gain Rangebound markets: What should investors do now? 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 BSE | NSE 01/01/70 Are Mutual Funds betting on ? Other Stocks in this news Jubilant Foodworks | Himatsingka Seide | DLF | Triveni Engineering and Industries | Gujarat NRE Coke | Sesa Goa |

In an interview with CNBC-TV18, Ambareesh Baliga of Karvy Stock Broking, spoke about his market outlook.

Here is a verbatim transcript of an exclusive interview with Ambareesh Baliga on CNBC-TV18. Also watch the accompanying video.

Q: What is your sense? Is the market just resting before it gets to the January high or would you bet on downside?

A: We have been betting on the downside for a while. For the next two-three weeks, the market should consolidate in this range. 5,000 could be the bottom for a while and we could see 5,150-5,200 possibly. The market doesn't have that strength or confidence to move beyond those levels.

Over the next two months, we should possibly be a bit lower than where we are right now. The market should move more towards 4650 levels over the next two-three months.

Q: Are you buying NMDC ?

A: NMDC yes, although it is slightly expensive from a retail investors' perspective, one can still apply for that issue which we have been recommending for the last couple of days saying that the issue will happen possibly at around Rs 315-320-325 levels. With the discount which a retail investor gets, it's a decent bet at that price because the downside seems limited. They may not be able to make the sort of money which some of the IPOs have given in the recent past. However, I think it's a good stock for a long-term investment portfolio.

Q: What about the Jubilant Foodworks performance since listing?

A: Performance has been excellent. We never expected these sorts of levels and we feel that at this point of time 40-45% growth over the next three years is already there in the price. It is already discounted.

We do not see too much of an upside from here. The risk reward ratio at this point of time is not really favourable for Jubilant Foodworks. Those who had got in an IPO had made a decent sum. Hence, we are suggesting people to keep exiting it.

Q: How are you calling these sugar stocks?

A: We got this cycle right on the way up and down. If you go back to January 2009, I had clearly mentioned that Balrampur Chini is a multi bagger from those levels. We expected it to be a multi-bagger from 15-18 months period, but it happened much earlier. Way back in September-October, we had called the down cycle right again because we were extremely cautious on sugar stocks at that point of time clearly saying that the down cycle would start very soon and markets would discount that at least three-four months earlier.

I see this down cycle to continue for a while longer and possibly you could have some bump up in the sugar prices over the next one-two months, once the crushing season ends. However, that bump up will be a small one. In case the sugar stocks bounce back at that point of time, it should again be utilized to exit. However, we may not see most of these stocks at the lows which we had seen one year back because most of these companies are sitting on a much larger cash pile than what they had last year. So things are better than what they were earlier, but you could see Balaramur Chini possibly closer Rs 75-80 levels over the next six months.

Q: Which midcaps are you recommending to your clients right now? Can you think of two-three names?

A: We have been recommending Himatsingka Seide which is basically into silk manufacturing and high-end textiles. So the margins are quite good. We have been recommending that and it has been quite steady at around Rs 44-45 levels.

In the auto ancillary, we are recommending a small player called Nelcast which is South-based player with operations now starting in North. So that is quoting at around Rs 74-75 levels. We have a price target of around Rs 130-140 for that stock. These are the two smallcap to midcap names which we are recommending.