Nifty to rise, buy on dips: Motilal Oswal

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Nifty to rise, buy on dips: Motilal Oswal

Nitin Rakesh of Motilal Oswal believes that the Nifty may move higher and advises investors to buy on dips.

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The Nifty has mostly been in the green post the Budget announcement on February 26. Positive global cues too have supported the Indian stock markets enjoy a week of cheer.

Nitin Rakesh, CEO-Asset Mgmt Biz, Motilal Oswal believes that the Nifty may move higher and advises investors to buy on dips.

Here is a verbatim transcript of the exclusive interview with Nitin Rakesh on CNBC-TV18. Also watch the accompanying video.
 
Q: We have had a positive run post the Budget, do you think we are headed to at least the January highs in the near-term?

A: I think after having seen the consolidation and the correction over the last few weeks, this week has been a good week for the markets. It clearly looks like we are going to test the January highs for sure whether it happens today or next week is an open question to debate. But I think we are at a fairly interesting point in terms of where the markets are headed from here. There is a very interesting dichotomy between the inflationary concerns, the interest rate concerns and obviously the growth that continues to surprise us on the upside. So I think all in all at 17,000 Sensex, 5,000-5,100 Nifty, we are clearly poised at an interesting point and more likely than not we will see higher levels.

Q: What do you do at that point if the market does scale up to around that 5,300 mark which is where we have usually seen turbulence, is that a sell call for you or this time do you think things are looking a bit different?

A: We always continue to focus on the bigger picture. The longer-term trends for the market continue to give us a lot of hope for further movement. I think one of the things that we tend to do in market movements that happen day-to-day is we tend to miss the woods for the trees. So even though we have had some turbulence for the market around 5,200-5,300, I think the underlying themes that we need to focus on continue to be very strongly in favour of consumers, savings and investments and I don't think we can take a rise off those themes. So anytime there is an opportunity in the market, we continue to build portfolios and we should continue to find those investment themes that otherwise would get expensive beyond a certain point in time.

I think we are not focused too much on whether 5,300 we will rest, we will come back, we will keep moving on, I think the focus has to be every opportunity of weakness in the market should be used to build a portfolio for the longer-term.

To give you an example, there is a concern out there even though we had a good day yesterday, but concern around the banking stocks primarily because of the interest rate environment and the hardening of inflation and what that does to the stocks, I think we sometimes tend to take a short-term view. Maybe over the next few months, there may be pressure because of the margins, deposit and lending rates obviously determine the margins, but I think in the long-term with credit offtake, with underlying growth in both services as well as industry, I don't think we can take a call that is anything, but a very positive call on that sector.

So we are taking a slightly more longer-term view, we were very happy that we got an opportunity in February, our clients have been very happy. I think we continue to work in a way that we focus more on what the underlying trends or themes are and then build it from the bottom up.