In an interview with CNBC-TV18, Pankaj Tibrewal, Fund Manager with Kotak Asset Management Company, explained why it makes sense to invest in companies that benefit from rise in discretionary and government spending, and said that sound stocks should be held in spite of seemingly rich valuations.
SBI, BHEL, Tata Steel, HUL and Cipla were top gainers while Coal India, TCS, Lupin, Sun Pharma and M&M were losers in the Sensex.
The bulls were back in form Thursday after two days of losses. Global markets were higher after minutes of Federal Reserve meet were released. Bank stocks led the charge ending 1.6 percent higher as the Bank Nifty closed at a new 52-week high.
When the market has been rising for a while, valuations turn expensive. Frontline stocks may look a safer bet, but much of the action would be happening in midcaps.
Midcaps are often overlooked by large investors and FIIs. Investments in midcaps are often considered risky as they are prone to volatility, but that's where the money has been made. Prakash Diwan, SP Tulsian, Ambareesh Baliga, Deven Choksey give their picks.
The banking space has rallied in the last two months helped largely by disclosures of bad loans. But the pain is not over yet for banks. It will last for two quarters at least, says Vaibhav Sanghavi, MD Of Ambit Investment.
Ajay Srivastava, CEO, Dimensions Consulting says there has not been much of fresh investments into Indian equities based on conviction about fundamentals. He expects March quarter earnings to be lacklustre, but says the market has already factored it in
Amit Rathi, MD at AnandRathi Financial Services says market will look for credible action plan on bank recapitalisation and spending on infrastructure in the Budget.
Market expert Atul Suri says technical charts indicate that the CNX Midcap index could slide all the way to 10,000 in the short term. And while the downside in the Nifty may not be as severe, there could be a rub off effect of the downtrend, Suri says
Stock exchange rules require companies to disclose the details of shares pledged by them. But many companies are known to get around the rules, because promoters hold shares in benaami accounts as well
According to Ajay Srivastava, CEO, Dimensions Consulting, a key concern for the market is the lack of leadership. He says many midcaps are doing much better operationally, compared to the large caps, which are floundering at the moment.
Dipan Mehta, Member, BSE & NSE believes action currently is in midcaps and will continue for the next 12-24 months.
Axis Bank, ICICI Bank, SBI, Tata Motors and Relinace are top gainers while BHEL, Coal India, M&M, Tata Steel and Cipla are major losers in the Sensex.
In the short term, Emkay's Dhananjay Sinha says he is bullish on companies that will benefit from a depreciating rupee. Also, he feels interest rates are likely to harden and says banks could benefit from better margins. Lastly, he is bullish on companies which are a play on urban consumption
Arvind Sanger of Geosphere Capital is not sure whether the selling in the Indian market is done for now, though he feels it is more panic-selling since India's macros are rather stable and it is earnings (including Q3) that is not showing enough momentum
Parag Thakkar of HDFC Securities expects more pain in markets if external factors continue to weigh on sentiments. He sees selling in the midcaps, due to margins calls, ending in coming two to three days.
Amit Rathi, MD, Anand Rathi Financial Services is of the belief that the pain in the market could last for another 3-6 months and from there on one could see an upward trajectory.
Sanjay Dutt, director of Quantum Securities, advises investors to buy largecaps as they have been totally ignored and there is froth in midcaps
Speaking to CNBC-TV18, Deven Choksey of KRChoksey Investment Managers says that fundamentally strong names are performing smartly, which is comforting in the current volatility.
Ajay Srivastava of Dimensions Capital says the pharma sector will give good returns from a 3-5 year perspective.
While the current year has not been too kind on the earnings-front, Mahesh Patil, Co-Chief Investment Officer, Birla Sun Life AMC expects the same to grow at 15-17 percent in FY17.
For long-term investors, Bhuvnesh Singh, MD and head of India research at Barclays, says internet companies are a good place to be in. But the problem is most of these companies are not listed, he adds. He believes there is lot of value in home improvement space and to that effect paint companies are still a good buy at current levels
CNBC-TV18's Udayan Mukherjee advises investors to look at strong segments from midcaps like consumption, pharmaceutical, cement, infra and auto.
This earnings season resulted in a lot of stop losses getting triggered, says Deepak Shenoy of Capitalmind.in. He is bullish on certain industries and midcaps.
Both midcap and smallcap indices are up 0.7 percent each. Tata Motors, TCS, NTPC, L&T and BHEL are top gainers in the Sensex. Among the losers are Cipla, Vedanta, Hindalco, ONGC and Hero.