Quantum upbeat on market despite frothiness in select sectors

At a time when several voices are worried about the market levels and the huge run up it has seen, Quantum Securities is upbeat about it.

“The market is intact…it will climb every wall of worry. People are forgetting that big boys have not moved yet,” Sanjay Dutt, Director, Quantum Securities told CNBC-TV18 in an interview.

Names such as State Bank of India, ICICI Bank, Reliance, and metal names, among others, are the ones which will power up the index and help it move towards 10000, he added. Having said that, Dutt highlighted that there are sectors such as midcaps and IPO listings that are frothy. In such a scenario, one could look at largecaps, which hold tremendous potential,” he told the channel.

Speaking on select sectors, Dutt said that IT companies are staring at problems right now. “We know the problem is there and is being addressed by the management,” he added. Dutt said that one has to see how mature and professional companies perform from this point.

Meanwhile, on pharmaceuticals he said that the sector was seeing lowest multiples in 7-8 years. It is time to start picking up stocks selectively.

Among non-banking financial companies (NBFCs), he believes that while midcaps are stretched in 3-4 months perspective, but the structural story is intact. “If there is 20-30% correction in companies you have identified, then it may be the right time to buy it,” he added.