Fundamentally market doing fine; cautious on smallcaps, microcaps: Expert

The market on Wednesday again closed flat -- the Nifty failed to hold 10,150, but the Sensex managed to stay above 32,400.

However, Rajesh Kothari Managing Director AlfAccurate Advisors thinks markets are fine because according to a study conducted by them out of the BSE 500 universe if one were to take out loss making and PSU Banks then one is left with 357 companies, and of that close to 181 companies have reported 15 percent plus net profit compounded growth in last ten years. Moreover, the market cap growth of those companies is exactly in line with the profit growth in those 10 years.

Therefore, fundamentally markets are fine, says Kothari although they look a bit heated currently. So one should be cautious on microcap, smallcap and poor management companies, he adds.

Market experts like SP Tulsian, Ashwani Gujral, Mitesh Thakkar and Sanjiv Bhasin Executive VP-Markets & Corporate Affairs IIFL also shared their views on Tata Steel's joint venture with Thyssenkrupp and other stock specific ideas. Bhasin is upbeat on quasi private banking space – Federal Bank and IDFC Bank and IDFC.