Weekly dossier: Ridham Desai, Neelkanth Mishra, Raamdeo Agrawal and others on markets, economy, art of investing

The Nifty rally is in line with the global bull run. Consumption will lead this market higher and we are positive on discretionary consumption.

On a price to book basis, broader markets look attractive. In 2021, we expect broader markets to outperform. Morgan Stanley sees a V-shaped recovery, not entirely priced in the equities.

India could start outperforming if supply chains start shifting from China to India.

FII flow into India is largely a function of emerging markets that are seeing outflows. Retail trading volumes are up 200 percent YoY which looks unsustainable.

India’s financial system is not out of the woods yet. Banks are raising capital which is not at the top of the cycle. If banks don’t lend more, that will almost force borrowers to default.

Neelkanth Mishra, Co-Head of Equity Strategy, Asia Pacific and Equity Strategist, India, Credit Suisse (to CNBC-TV18)

The recovery of the Indian economy depends on higher government participation against the recent average.

Indian economic activity trackers have started dipping in July. Most indicators are suggesting rural activity level flattened out in July.

I would like to warn against the correlating market moves with the Indian economy.

We expect India exports to continue to outpace imports. Excess liquidity needs to be pulled out once the economy stabilises.

Global equity markets are buoyant owing to liquidity gush. It is encouraging to see US retail sales getting back to pre-COVID levels.

We are overweight on IT space and large banks. We are also overweight on metals but need to track the trends from China.

The movement of raw materials globally bodes well for the Indian ferrous sector.

Raamdeo Agrawal, Co-Founder and Chairman of Motilal Oswal Financial Services (to CNBC-TV18)

Investing does not require a qualification, but it requires a lot of common sense.

An investor seeks the safety of the money invested and a decent return while a trader or speculator is only interested in the price action of the short term.

One fundamental thing to understand is there are two kinds of business- good and bad. Only the good businesses give compounding returns.

You need to figure out whether the company has the potential and is able to sustain itself for the long term or not. Another important thing is to see if the company's management is competent or not.

Growth mindset and value system are the key traits of competent management.

At last, look at the price as your purchase price will decide your return. It is a technical aspect. You need to assess the value of the company a to where can it reach in the future.

Harsha Upadhyaya, President & CIO – Equity at Kotak Mahindra Asset Management Company

The market seems to be looking forward to FY22 and beyond, which are expected to be normal years for businesses.

If you look at the immediate term, definitely the earnings decline is going to be significant. For example, most estimates are pointing to around a 40 percent decline in aggregate earnings during the April-June quarter. Even July–September quarter is unlikely to be a normal one.

The increased volatility in the market and continuing concerns around the spread of Coronavirus outbreak have led to investors taking a more conservative view on equity investments in the current context.
However, the longer-term trend of the shift away from physical investments to financial investments will continue. Once the market stabilises and/ or there is clarity on the containment of coronavirus, we expect equity investments through MFs to improve.

Gaurav Dua, SVP, Head - Capital Market Strategy, Sharekhan by BNP Paribas

The much-awaited and important events in the second half could be the US Presidential Election in November and the possible success in finding a vaccine for the coronavirus.

Any disappointments on both the front could hamper the pace of economic recovery globally. In India, the moratorium period would get over by August-end.

The risk could arise from the weak demand trends in the festive season ahead which could put a question mark on the pace of recovery in the economy and the expected normalisation in the corporate earnings in the next fiscal.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol advises users to check with certified experts before taking any investment decisions.