Nifty may see new highs in January: Ambareesh Baliga

The Indian market has been subdued this week. In an interview to CNBC-TV18, independent market analyst Ambareesh Baliga says the strength is back. "I have been saying that possibly it should cross 6,000 by the end of this month," he asserts

In January, he sees new highs. "I suppose for the month of January, the band could be about 6,000 to 6,350-6400," he adds. According to him, the Gujarat Polls could be a game changer going ahead. Also Read: Bias remains positive, Nifty may see 6K: Sudarshan Sukhani Below is the verbatim transcript of Baliga’s interview to CNBC-TV18 Q: Do you think the strength is back in the market or is it going to be a quite close for December? A: I think the strength is back. We could have the Nifty crossing 6,000 towards end of December. Clearly, we are on the way for that. The performance of the UPA in Parliament, in the last few days, is also adding to the confidence. I suppose the Gujarat polls could be a game changer going ahead. That also could trigger the next range, which is beyond 6,000. Q: Do you see a possible victory of Narendra Modi actually spurring the market today? A: To a certain extent, yes, because that will have a bearing on what we could see in 2014. Although I am not a political expert, but this is what people have been talking of. Q: How would you approach some of these Non-Banking Financial Banking Companies (NBFCs)? Between L&T Finance Holdings, Bajaj Finance, and Shriram Transport, which one would you look to buy? A: I would surely look at L&T Finance Holdings and Shriram. They are one of the front contenders for the banking license. But then again, these stocks have moved decently well in the recent past. So, that momentum can continue for a while longer. Do we expect the banking license in January? I doubt. That is going to take much longer, atleast seven-eight months if not more. Then you have the election. So, I really don’t know whether it can further get delayed because of all that. I would say that, in this rally, possibly in the next few weeks, one should look at booking out to a certain extent because something like L&T Finance has actually moved up from these levels of Rs 44-45. It can go up to levels of Rs 110-115 but beyond that could be difficult in this rally. Q: Do you have any thoughts on Karnataka Bank? There have been reports that Securities and Exchange Board of India (SEBI) may be looking into that big stock run that we saw on it? A: Because of the Banking Bill and expectation of some sort of consolidation going ahead, I suppose Karnataka Bank and Dhanlaxmi Bank are the best candidates. From that point of view, we have seen that move. But I suppose this investigation by SEBI could be a bit of dampener for this counter. _PAGEBREAK_ Q: What kind of levels do you see the Nifty reaching by the end of the December series? A: By the end of December series, we should be able to cross the 6,000 level. In January, you will see new highs. That’s the way I see this momentum really carrying on because of the liquidity factors. You will have the foreign liquidity again restarting in a big way in January. At the same time, the domestic investors who have stayed out all through that move from 4,800 levels to the current levels, they would start jumping in. Q: What have you made of this rally on the entire Adani Group of stocks? In the last couple of sessions, those stocks have rallied between 20-50 percent. A: You can call it Modi effect because it has been quite clear that Narendra Modi is going to win. The only question is whether it will be a thumping majority or a simple majority. Q: What kind of trading range do you think we would hold in January around these levels? Do you think it will be a much wider band because there is earnings and other news flows that goes into that month? A: I suppose it will be a wider band. I have been saying that possibly it should cross 6,000 by the end of this month. So, I suppose for the month of January, the band could be about 6,000 to 6,350-6400.