Market has factored in bad news of Q3, Q4: SP Tulsian

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26 Aug, 2025 12:21

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The market seems to have bottomed out with most of the stocks correcting between 25-30 percent, said SP Tulsian of sptulsian.com adding that the market has factored in bad news of Q3 and Q4.Tulsian further said that broking stocks have not seen improvement in volume despite stocks moving up.  Below is the verbatim transcript of SP Tulsian's interview to Prashant Nair and Sonia Shenoy on CNBC-TV18.Sonia: Any idea why these brokerage/NBFCs stocks are surging and do you like to own any of these names?A: We have all been talking about all these negatives on these negatives on the NBFCs for a while and if you really want to give any fundamental reason for all this brokerage stocks to up, I don’t find any fundamental reason number one.Number two if you see all this brokerage stocks, three stocks which you have mentioned or maybe 4 or 5 if I can add there maybeEdelweiss, Motilal Oswal and IIFL Holdings -- they are now not the pure brokerage company if you see the total income to the profit after tax (PAT) I don’t think that brokerage must be contributing even 5 percent of the PAT to the bottom line of these companies.It is difficult to say that the things have really started improving. We have been seeing the fate of the market for last one and a half month whether we are able to take a right call on the industry NBFC, tyre stocks, automobiles stocks that a different case, but in case of the broking industry definitely for the last 1-1.5 months we have not seen any volume picking up in spite of that the stocks are moving up. I will only draw one conclusion that couple of hours up move can quickly change the sentiments on a sector or maybe on the market that is what is happening now in the case of broking stocks.If you see Edelweiss, I can understand Edelweiss Financial have been going up for last couple of days, today is a third day in continuation the stock has moved up by 10 percent. Can you give me any one valid reason -- naturally if it is going up you have to say or you have to substantiate some positives to that stock itself.Now see the same thing having spread to the other broking stocks as well, we have talked JM Financial, IIFL Holding, Motilal Oswal -- so my point is that this is what we have discussed in the morning or this is what I have been saying, I am not taking a positive view on the market in the near term, but what can be concluded or what can be inferred that market seems to have bottomed out -- now it just needs a positive trigger which may come in the form of the pre-budget rally, expectations from the budget.Suppose take the case of the negatives of this demonetisations, we have all understood and we all only defer on the time horizon whether it can go beyond Q4 or not. We have seen the extreme pessimist also who have given a GDP projection as low as half percent for Q4, but if you take a call that what all can change the sentiments with the budget expectations and ultimately having delivered in the budget that can change the sentiments to a great extent.So yes, markets seems to have bottomed out on all fronts -- you can subdivide the market into various segments, but I won’t be taking a negative call going from here on, because all the stocks having corrected by about 25-30 percent have more than factored in the negatives what are going to be seen in Q3 as well as in Q4.Prashant: Any thoughts on Bajaj Finserv I don’t know if you track it, it is trading at Rs 2,686 right now not very much happening today, right sector, low penetration sector, great brand franchise etc. It did well till the last few weeks, any thoughts on it?A: You have to go by the movement or maybe the price behaviour of Bajaj Finance. I agree that last weeks we have seen one day the stock moving up by about 4 percent, because Bajaj Finserv being the promoter and the holding company of Bajaj Finance and we all know the fate of the NBFCs and Bajaj Finance has taken a big hit and I have been maintaining my extreme positive view on Bajaj Finance, because if you want to derive the value of Bajaj Finserv you need to take a call on Bajaj Finance, because which has a very growing business and all that and the management have confirmed that the growth of 25 percent will be seen for next 2-3 years and except for the insurance business if you knock off, which has already been seeing moving in a stagnant manner for the Bajaj Finserv, because that was not the driving force whatever accretion or increase in the share price, which we have seen in Bajaj Finserv in this last one year has happened because of the share price increase in the Bajaj Finance.I won’t be taking standalone or isolation call on its standalone business of the insurance of Bajaj Finance, where I am keeping my neutral stance, but yes because it being the holding company of the Bajaj Finance we need to take a view once the Bajaj Finance starts moving up, you will see the upsurge again coming back in Bajaj Finserv as well.Prashant: We discussed this with you earlier, very quickly does Reliance Communication business continues to struggle, but there is a big valuation difference any upside here?A: R-Com now is monetising all its assets, in fact this is what I have expressed earlier also about couple of hours back and if you see they are in the process of monetising the business, even if you go by their verdict firstly the debt is not Rs 42,000 crore it is about Rs 46,000-47,000 crore and I have not included the deferred payments to be made to the government and all that -- even if I take this Rs 31,000 crore coming in, they need to liquidate their debt of about Rs 14,000 crore, because again there is confusion of this Rs 20,000 crore which is getting transferred to Aircel JV calling as a debt repayment while it remains exactly with the company to the extent of Rs 20,000 crore -- so if you want to liquidate the debt of Rs 16,000 crore and you don’t have that much matching assets with you -- I don’t think there is any point in taking a call on R-Com because R-Com from here on will not remain a functional company, they will be having a very lease business which will not be too much income yielding or profit yielding to the company thereafter.Prashant: Any thought on this import duty 6 percent compared to 10 percent earlier and one would thought that the government doesn’t like gold very much?A: That may give a sentimental boost to the jewellery stocks, but I don’t think that looking because on one hand if you are talking of the fall in the spending and we are so circumspect on the essentials, where the spending is getting postponed, so why to talk of the gold and all kind of spending -- so yes that will be seen mild positive for the jewellery stocks and this can happen because eventually people are talking that the import duty on the gold will go away because of the lower demand seen for the gold, because if you see the gold was heavily earlier bought by in number two or maybe out of books and that has gone away -- so maybe to keep some at least momentum in the gold market, we may see the gold import duty eventually going away as well.Prashant: Just a quick word on Bharti Infratel, Rs 336 on the price it is down another nearly 3 percent today?A: I have never kept positive view on this stock, because firstly if you see -- take the view in the last 6 months they started with the share buyback by slashing the huge dividend number one. Number two they are looking to monetise the stake of the promoter that is Bharti Airtel -- that is again seen as a big hangover and with the R-Com dealing having taken place at Rs 25 lakh per tower obviously market will be reducing the valuation of Bharti Infratel also which is a significant player in the tower space.Ekta: Have you had a look at this Pritish Nandy stock, it is gaining after that they struck their deal with Amazon. Have you had time to go through that?A: I have gone through, but I am not convinced with the deal, because this kind of deal we have seen if you take the history of last 10 years of the company, you never had any kind of significant what you called financials having seen from the company -- so I am not convinced with the order flow which we have seen couple of days back.If you recall maybe 2 days back the stock was in the 20 percent upper circuit and yesterday it was down, so I am not taking a positive view on the stock going forward.Prashant: Havells India have you taken a look, Rs 322 is where Havells is trading at?A: I like the stock now having corrected from Rs 400 plus. The stock has reached to its reasonable valuation and looking to the huge cash now lying with the company of about Rs 1,500 crore one has to see that what kind of move is initiated by the promoters next. Maybe they are waiting for this demonetisation to get over, have the feel of the market. Definitely they are looking for inorganic growth. Without resorting to much debt keeping the debt free status of the company I think that the current