Investors need to be careful going forward as the Nifty-50 is again moving closer to its previous peak. Structurally, our markets are still in a bullish phase as the Nifty-50 sustained above the 200 DMA in the recent correction.
Whilst there is no denial of the fact that the market is primarily driven by the excess liquidity, but we also need to bear it in mind that the market price always reflects the present value of the future cash flows.
At SageOne, we always strive to build and maintain a portfolio of superior businesses with high earnings growth (20%+ CAGR) available at a cheap or fair valuation.
Liquidity indeed is a cause of volume in this segment however it seems that investors feel this segment to be relatively undervalued and are expecting good returns with the recovering and rising Nifty.
For the Indian markets to do well, the large caps have to do well, as they are the companies most geared to the improvement in the economy, dominate their industry or niche, usually have a key advantage or a moat.
IPO market is on a mend for sure. We also believe that with the recent change in regulations for Multi-Cap Funds will accelerate the supply from small and midcap companies too.
Inventors are advised to follow a stock-specific approach by skewing their portfolio towards strong momentum sectors like Pharma and IT while investors can wait for a correction.
If Nifty sustains above the 11500 level it is expected to test its level of 11800 by the expiry next week. The key level to be respected is 11300-11350.
In terms of domestic valuation, Nifty is trading at 19 times FY22 earnings which don’t leave a lot of margin of safety.
In so many ways, the current rally has run ahead of the fundamentals. I think businesses on the ground are not doing too well, says Nikhil Kamath of True Beacon.
Continues strength in the rural economy on the back of a good monsoon along with pent up demand bodes well for Agrochemicals, two-wheelers, and tractors.
The broader base is the initial phase and then subsequently it is narrowed down to high earning growth sustainability where multibaggers are created.
Global diversification is the theme nowadays, as almost all ultra HNI investors are looking to have a pandemic-proof portfolio with the right proportional mix across major stock markets of the world.
Metal and Realty sectors have caught the attention of the bulls recently. Rising metal prices, falling input prices, and signs of revival in demand have all led to positive sentiment in metal stocks.
The world is reinventing as it goes through this pandemic -- what does it need to emerge stronger, bigger and better? It’s now a scenario of the survival of the fittest and we need to prepare optimally for the same.
For investors, I have one only piece of advice - BUY businesses that are likely to deliver growth and do not worry about market levels.
Financial independence comes through long term financial planning, and I always keep saying that there is a difference between just saving for the rainy day.
It is advisable to keep at least 3 to 6 months of your expenses as an emergency fund and putting those funds in highly liquid instruments such as liquid funds or fixed deposits.
If we dissect the move to detail then the journey from 10840 till now, it has been the most volatile due to high frequency of sector rotations, and leadership rotations within the index constituents.
In the agrochemical and chemical space, we prefer Aarti Industries, Galaxy Surfactants, and PI Industries. Britannia Industries and Bharti Airtel are our top picks in the FMCG and telecom space.
Deposit growth for good quality, technologically superior large private sector banks have grown by 20 percent during April-June 2020.
We took the current market volatility as an opportunity and worked to create sustainable building blocks to generate long term returns for our esteemed investors.
The rally in the IT stocks may take a pause, however, the pharma index has just closed above the 61.8% Fibonacci retracement level of the previous major decline indicating room for an extended rally on cards.
The markets have bounced back sharply from the bottom. It is a clear global phenomenon, and India is not an exception here. I think there are three clear drivers of this rebound.
We follow Growth at Reasonable Price (GARP) which focuses on three segments i) Value with triggers, (ii) Earnings upgrade Cycle, and (iii) Thematic changes.