Mkt fall should stop now; buy Dewan Housing Fin: Experts

Anuj: How is it looking, is it looking something similar to what happened in 2008 or would you say that this is still a bull market correction and should be used to actually buy?

Malkani: Well I shall hesitantly say the latter.

Anuj: Why hesitantly?

Malkani: Because certainly these kind of huge cataclysmic falls are reminiscent of that era, there is no doubt about it but there is no denying that we are considerably better off than other emerging markets, all the stuff has been said and done but clearly if the entire world markets are going through this major jitters maybe rejigging-I doubt it very much but the jury is still out and if some of the money starts to go back to developed markets but clearly-and the amazing thing has been the resurgence of our own retail money and via mutual funds which has countered some of the-which is an extremely healthy development in the last few months. You can see even in August against the Foreign Institutional Investors(FIIs) number of 15,000 or 17,000 whatever it depends the futures etc, we had 10000 inflows from mutual funds, so that is not to be scoffed at.

Anuj: What can change things in India? There is a clamour for a rate cut from our own RBI governor, do you think that could be a bit of a game changer or do you think the market needs to have some kind of big positive trigger to move on, what can be that positive trigger that can end this correction and take market higher?

Malkani: Largely to be honest, this is all being externally driven,so I know it is an odd answer but the fact is if the FIIs selling a bit for international reasons rather than our own-of course there is some amount of investors getting angry with stuff being slow on the ground. There is a lot of people like Jim Rogers etc out there who are saying ok, enough now, we have been disappointed with the pace of reform etc, so all that is there but I don’t think-this is a mixed bag, we can’t-it is more to do with factors out there and so that –and of course some moves here would greatly help. If for example now Bihar elections is a big one, if the current regime does well, progress on GST, the old stuff. Land by and large they have diffused it by transferring it to the states, so there is some of the-but most of the action is international and as long as oil continues to go in our favour, lot of our sins can be forgiven.

Ekta: What is your sense in terms of what could stabilise the markets and would this be a good time to dip in and if so, in which sector or stock?

Mehta: Yes probably it is a very difficult day to talk positive about the markets but somehow we need to keep the faith and conviction going that we are going to be a better performing market going forward as soon as this flows or rather outflows of FII abates, so there has to be some semblance of stability in the markets and I am not saying that FII will be gung-ho on the markets and come and buy tomorrow but at least if the selling stops and probably this time around we have got a good DII support or good retail inflows, High Net Worth Individual (HNI) inflows into the market which at least can support market, can’t lead it forward but at least if this supports the market, then probably –lot has been talked about the macros of Indian markets and how we are better placed, I won’t repeat that but probably we might be somewhere close to the bottom though it is a very difficult guess to take but if somebody wants to invest in this market and has missed out on the bus earlier, then probably this is the right time to enter at least 15-20 percent and start deploying money in good sectors and good stocks.

Anuj: One more problem for the market has been that till about two months back while the Nifty was not giving you any returns, the midcaps made a lot of money, the midcap index kept making new highs, the junior kept on making new highs. The last correction has been quite brutal for the midcap space and the Nifty Junior as well. Today also the midcap index is down a good three percent. Do you see some more damage in this particular space?

Malkani: Clearly midcaps is much more risk reward as we always say, so if this trend continues, of course it will be and many of them hand our heart clearly the valuations are frothy and you could-there is scope to fall a lot and once in a while if there is some news as in the tragic case of Amtek etc, then God help you.

So, yes bottom line I still think around near the market fall should stop but who is to say if something major happens. At the moment still it is clearly quite scary-it is obviously basket selling when it suddenly falls like this.

Anuj: What can change things in India? There is a clamour for a rate cut from our own RBI governor, do you think that could be a bit of a game changer or do you think the market needs to have some kind of big positive trigger to move on, what can be that positive trigger that can end this correction and take market higher?

Malkani: Largely to be honest, this is all being externally driven,so I know it is an odd answer but the fact is if the FIIs selling a bit for international reasons rather than our own-of course there is some amount of investors getting angry with stuff being slow on the ground. There is a lot of people like Jim Rogers etc out there who are saying ok, enough now, we have been disappointed with the pace of reform etc, so all that is there but I don’t think-this is a mixed bag, we can’t-it is more to do with factors out there and so that –and of course some moves here would greatly help. If for example now Bihar elections is a big one, if the current regime does well, progress on GST, the old stuff. Land by and large they have diffused it by transferring it to the states, so there is some of the-but most of the action is international and as long as oil continues to go in our favour, lot of our sins can be forgiven.

Ekta: What is your sense in terms of what could stabilise the markets and would this be a good time to dip in and if so, in which sector or stock?

Mehta: Yes probably it is a very difficult day to talk positive about the markets but somehow we need to keep the faith and conviction going that we are going to be a better performing market going forward as soon as this flows or rather outflows of FII abates, so there has to be some semblance of stability in the markets and I am not saying that FII will be gung-ho on the markets and come and buy tomorrow but at least if the selling stops and probably this time around we have got a good DII support or good retail inflows, High Net Worth Individual (HNI) inflows into the market which at least can support market, can’t lead it forward but at least if this supports the market, then probably –lot has been talked about the macros of Indian markets and how we are better placed, I won’t repeat that but probably we might be somewhere close to the bottom though it is a very difficult guess to take but if somebody wants to invest in this market and has missed out on the bus earlier, then probably this is the right time to enter at least 15-20 percent and start deploying money in good sectors and good stocks.

Anuj: One more problem for the market has been that till about two months back while the Nifty was not giving you any returns, the midcaps made a lot of money, the midcap index kept making new highs, the junior kept on making new highs. The last correction has been quite brutal for the midcap space and the Nifty Junior as well. Today also the midcap index is down a good three percent. Do you see some more damage in this particular space?

Malkani: Clearly midcaps is much more risk reward as we always say, so if this trend continues, of course it will be and many of them hand our heart clearly the valuations are frothy and you could-there is scope to fall a lot and once in a while if there is some news as in the tragic case of Amtek etc, then God help you.