Kunal Bothra of LKP advises traders to avoid real estate stocks from a portfolio point of view.
Kunal Bothra of LKP told CNBC-TV18, "The real estate sector is considered high beta and whenever we have sentiment going bullish these are the sectors which give very strong returns. Surprisingly the breadth of the market is not supporting and real estate holds the key over here. You look at the stocks DLF, HDIL and even Unitech, IVRCL many of these real estate players they have more or less shown a bit of outperformance probably couple of weeks back but then they have moved in sync with the larger trend and the trend for these stocks are now turning on to be bearish."
He further added, "HDIL, couple of weeks back it showed an indication that break above Rs 60 and it could sustain those levels and probably head on to Rs 70-75 levels. However once again look at the intensity of selling. My sense is that these stocks, the real estate stocks could be at least a couple of months away from really making a large bottom if you are looking at Nifty anywhere close to 6300."
"So, I would probably avoid these stocks from a portfolio point of view. Probably take a bet only when the market gathers momentum and the midcaps probably pick up from there."
Disclosure: I do not have any personal holdings in any of the stocks mentioned, but at LKP we recommend these stocks to our clients as well.