Watch the interview of Monika Halan, Executive Editor, Mint Money is our personal finance expert and Shahina Mukadam, an Independent Market Expert will be answering all your stock queries.
Below is the verbatim transcript of Shahina Mukadam’s interview with CNBC-TV18:
One should continue to hold State Bank of India (SBI). This stock is looking a bit weak but it is looking very close to its medium term lows and I would say a three month target of about Rs 335. “If you really see the pressure is coming because of the FPO that the bank has announced; it will raise something like a Rs 15,000 crore odd, so that is putting the pressure and a retail investor will get it slightly cheaper than the current market price but the fundamental of the bank remain very strong. Given the fact that the increased money that will flow in because of this FPO will enable it to drive credit growth and the bank has been one of the better performers. If you see the last quarter numbers a profit growth of about 30 percent and both the net interest margin securities (NIMS) as well as the asset quality has been maintained.
ICICI Bank, L&T, ITC
One should structure equity portfolio in terms of having a composition of large caps which could be a core portfolio for a very long term as well as some part put in growth stocks which you can look with a one to two year horizon. So it basically gives you a good mix of relatively sage stocks as well as an opportunity to give you above market returns.
In the large cap stocks in the next five to ten years which I believe would be a long term investment portfolio horizon you could look at some of the leading private sector banks which have in fact corrected. We have something like an ICICI Bank which is correcting, you can take this correcting opportunity to get into a stock like ICICI Bank with a longer term view. There is HDFC Bank which is an all time favourite. You can look at that as an alternative also.
In infrastructure you can look at something like an Larsen and Toubro (L&T) and also in terms of consumer you can look at ITC which has basically corrected because of the negative implications that have come in the Budget which will be a short term negative but for the longer term investor it is going to be a phenomenal investment given the fact that the FMCG business, they are targeting something like say 10 years down the line multiple growth in the FMCG business to Rs 1 lakh crore, so that would give it support.
For the midcap stocks you could look at some of the stocks which have again corrected. Something like an Idea Cellular which gives you an exposure both to a good consumer growth as well as valuations remain in its favour which has also corrected. You could look at another midcap FMCG stock maybe something like a Marico or a Dabur which also have given you decent returns in the last one year but would look good going forward. So, this was just to give you a broad idea of a portfolio that you can construct.
In individual stocks you need to really look at the buying price when you are getting into stock specific as well as keep a strong stoploss for each of the stocks so that you don’t take a hit of more than, say 10 percent for the shorter term holdings and maybe a slightly deeper stop losses for the longer term holding portfolio. So you need to construct a portfolio and remain invested for the medium to longer term because in the shorter term it is very difficult to make money specially in volatile markets like this.
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