Amit Jain, who co-founded Ashika Global Family Office Services, still expects Nifty at 25,000 by December 2024. But also, there are very high chances of a sharp correction in the US market before the US election, which in turn will have a rubbing effect on the Indian stock market as well, he said in an interview with Moneycontrol.
In the Union Budget likely to be presented in the second half of July, the market veteran with more than 18 years spent in the banking and financial services industry believes the focus will be more on the rural population and measures to uplift demand in rural areas.
Do you think the market is done with the rally, or do you still see Nifty at 25,000 before getting into correction mode?
On August 18, 2023, in an exclusive interview with Moneycontrol, everyone was bearish on the global and Indian stock markets, I gave a contra-bullish call on the Nifty with a target of 25,000 around December 2024. At that time, everyone in the world and the Indian stock market was very bearish, as the Nifty was hovering around 17,000 to 19,300 for a very long consolidation period.
In that interview, I specifically mentioned that the banking sector will outperform the IT sector and other sectors, which now turns out to be true as the Bank Nifty has touched a new high.
As of today, the destination remains Nifty at 25,000 in December 2024.
Do you see any risk factors in the financial space?
In the last month, we have seen a fantastic rally in all banking stocks on the expectation that Indian bonds will start getting included in the JP Morgan emerging market bond index on June 28, 2024. This inclusion will affect the weight of Thailand, Poland, and the Czech Republic in the Global Bond Index. It’s great for the Indian market, as we may see a correction in Bank Nifty and the broader market index. Also, there are very high chances that before the US election, we will see a sharp correction in the US market, which in turn will have a rubbing effect on the Indian stock market as well.
Should one start accumulating technology stocks now?
At this point in time, the IT sector, oil PSUs and very selected PSU banks look a little undervalued from a long-term perspective. As of now, I will prefer mid- and small-cap IT stocks that focus on AI in blockchain as an underlined business model compared to routine software service providers. Hence, long-term investors start accumulating those stocks, keeping a long-term view in mind. Also, very few quality oil PSUs and banks, which are trading at a price to book of around 1 to 1.5, look like compelling buys from a medium- to long-term perspective.
Do you see petroleum products under GST in Modi 3.0?
Yes, I believe that there are very high chances that petroleum products will come under GST in Modi 3.0. If there is a consensus among various states and sectors for revenue sharing, this is a very long-pending demand by Indian consumer and industry bodies.
Do you see CPI inflation rising again in the second half of 2024?
On the face of it, it looks like the worst inflation number is behind us. Going forward, we will have moderate inflation with higher growth, which will have a positive impact on our overall fiscal deficit and GDP growth rate. The only risk I see in this scenario is geopolitical risk, which cannot be anticipated at this moment.
What are your expectations from the Union Budget, which is likely to be announced in the second half of July?
As we all know, Modi 3.0 is a coalition government, unlike previous years where the BJP itself had a clear majority. Due to this coalition, I believe the upcoming budget will focus more on the rural population and take measures to uplift demand in rural areas. In my view, there will be tax rationalization on agricultural and household products, and the government will continue to focus on physical and digital infrastructure.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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