He said there is a strong chance that RBI will ease liquidity concerns. In addition, it is a duty of any finance ministry that they have to reassure and try to contain NBFC crisis
Ramesh Damani, Member, BSE told CNBC-TV18 that BJP won two elections with thumping majority, which proved that Narendra Modi, who will continue as Prime Minister, understands common people very well.
But he added that the market is in the higher end of the range and hence will not run away from here.
The benchmark indices hit record highs on policy continuity at the Centre. The BSE Sensex touched 40,000 and Nifty at 12,000 for the first time in history.
Ramesh Damani advised investors to invest in quality companies. "We are recommending recently listed PSU railway and defence companies, which are cheap and will benefit from expected government spending on infrastructure," he said.
He further said railway stocks are trading at single digit PE now. "Railway and defence are contrarian bets and no brainer."
On asking about FII money, he said, "Lot of investors we spoke to on exit polls day indicated that FII flow will continue in India due to policy continuity. Even a lot of deals, which got stuck due to elections in the last six months, will get cleared."
Definitely, there is buoyancy in FII inflow, he feels.
He said there is a strong chance that RBI will ease liquidity concerns. In addition, it is a duty of any finance ministry that they have to reassure and try to contain NBFC crisis.
After current runaway rally, valuations are too steep. "Lot of stocks in midcap are not working due to earnings concerns, poor visibility and a lot of technology transformation."On biggest risk, Damani said, domestically, NBFC crisis is the biggest risk which the Finance Minister has to address. Globally, rattles in the Middle East by Donald Trump is a big risk for all, he added.Subscribe to Moneycontrol Pro and gain access to curated markets data, exclusive trading recommendations, independent equity analysis, actionable investment ideas, nuanced takes on macro, corporate and policy actions, practical insights from market gurus and much more.