The market is likely to touch new highs going forward and two themes which will fuel the rally will be private sector banks, NBFCs, and IPOs, Rajat Rajgarhia, MD, Institutional Equities, Motilal Oswal Securities said in an interview with CNBC-TV18.
The next leaders of the rally are private banks and NBFCs. They have led the charge for the past 2-3 years and the second leg of the rally will come from IPOs, he said.
We have seen some crazy momentum seen in IPOs which listed recently and that is typical of any rally. The IPO pipelines is getting rich over the coming months. We are likely to see a great response from many of them in the coming months, suggests Rajgarhia.
The uptrend is here to stay bearing the volatility of 2-3 percent, he said. The large part of the rally was led by flows which have been the key contributor to the rally which we witnessed in Indian markets.
“The whole character of this market is a very large domestic allocation of equities which has provided a solid base to this market. The inherent volatility caused by FII flows has given way to stable domestic glows,” said Rajgarhia.
Commenting on Reliance Industries, Rajgarhia said that he is surprised by the extent of the rally in Reliance Industries in the last 6 months.
For the largest market cap to move up by 40 percent in a period of 4-5 months does come as a surprise. But, that’s what markets are made off. If they don’t surprise then they don’t get the excitement, he said.
(Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd)
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