Corporate FD and government small saving schemes still remain one of the attractive avenues for the investor after the bank's FD for a fixed return.
We expect the next bull-run in BFSI, sugar, pharma, metal and infrastructure sector, Asutosh K. Mishra, Head of the Research, Institutional Equity at Ashika Stock Broking, said in an interview with Moneycontrol’s Kshitij Anand.
Q) Given the fact that we are trading near record highs - what should be the investment philosophy of investors.
A) Although benchmark Indices are trading near all-time highs, the broader market remains weak. Given the current market dynamics, we expect an improvement in the broader market and believe mid-caps to outperform the benchmark indices.
Q) We are almost done with the September quarter earnings – how did India Inc. perform so far in Q2. Any bright spots which one can look at?
A) We entered the Q2 earnings season with very low expectations and on the back of that, performance looks healthier for a large part of our coverage universe.
Earning also got a boost due to the corporate tax rate cut. Hereon, we expect good traction in metal, PSU, infrastructure, banking, cement, sugar, and pharma stocks.
Q) We have seen large-cap stocks leading the rally on Sensex and Nifty while the broader markets still remained under pressure. Can we say the big wealth will be created in quality small and mid-caps if someone is looking at a time horizon of 2-3 years?
A) Yes, we expect large wealth to be created by investing in quality and growth-oriented mid and small-cap stocks. But, here investors need to be patient along with more vigilant to generate sustainable wealth.
Q) With FD rates going dry what are the other avenues of investments which investors can look at if they are looking for something secure?
A) Corporate FD and government small saving schemes still remain one of the attractive avenues for the investor after the bank's FD for a fixed return.
Q) Do you think realty and auto could turn out to be the dark horse for the year 2020?
A) Realty and the auto sector are still facing a lot of headwinds but some green shoots are visible. Our approach is selective stock picking in both sectors as some companies are able to re-modified their business and thus have promising futures.
Q) The big question which most investors have – is the worst behind us in terms of domestic macros as well as earnings?
A) Worst is not behind us on the macro front as some lead indicators continue to indicate border slowdown in the economy. However, on the earnings front, we see the worst is behind us as the cut in corporate tax has boosted bottom-line performance.
Q) Sectors that are likely to lead the next bull run – insurance, AMC business or zero debt companies such as IRCTC?
A) We expect the next bull run in BFSI, sugar, pharma, metal and infrastructure sector.
Q) What should be the strategy of investors with respect to MFs? Even though Sensex might hit a record high in November, most of the portfolios are still running into losses.
A) In our view, SIP is one of the best plans for retail investors despite huge volatility in the returns in the last 18-24 months.Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.