Talking about the current market situation and future outlook with CNBC-Awaaz on the occasion of 20 years of CNBC-Awaaz celebration. N Jayakumar, MD, Prime Securities Said that CNBC-Awaaz has a big contribution in developing Equity Cult. The channel would continue its involvement for several decades.
Talking about the market, he said that investing in the market at the right time is a big task. It is important to continue investing in the market. Investors should maintain investments in SIPs and MFs, trade with only 20% of the amount. Investors in the US faced many crises in 44 years. In 1987, the market fell 23% in one day. Also saw the Asian crisis and the global financial crisis. There was a culture in the US of investing in equity from salary to the market. Even in the Indian market, salaried people have moved towards the market. Equity investment increased from 3% to 5% in the last 5 years. Equity investment is possible up to 15% in the next 15-20 years. There will be no impact of FIIs selling on increase in equity investment.
Market is now moving towards structural bottom
For the first time in the last 3 years, a decline was seen in the market. The decline in the market has been less compared to the portfolio. The market is now moving towards the structural bottom. A structural bottom appears to be forming before a long uptrend. Investment in US may increase with Trump’s arrival. While there were problems in the world, Indian markets were doing well. The decline is a good buying opportunity for investors.
Boom will continue in IT, Pharma, Real Estate
N Jayakumar said that the money of new investors will remain invested in the market. New investors have full faith in saving and consumption. New investors have full confidence in India’s growth. IT, Pharma will benefit the most from the strengthening dollar. The boom in the pharma sector may continue further. Strong growth of pharma segment is possible in US and Europe. Relief on import duty is also positive for the pharma sector. Good investment in real estate can also increase.
Rupee will show level of 88-90 by June
Talking about the falling rupee, he said that by June the rupee will go up to 88-90 against the dollar. Export related sectors will benefit from the weakness in the rupee. Many NRIs may return to India. NRIs’ business will remain abroad but they will return to India. A lot of money will also come to India due to NRIs coming to India.
Increase in government and private capex is possible in the next few days
There is a correction period in the market for the last 6 months. Private capex has still not increased. Government capex remained quite low in the last 8 months. After November, the government has started increasing capex. The agriculture sector will benefit by increasing the MSP of many crops. MFI’s problems may end in the next 2 quarters. There has been a rise in MFI related shares for some time. Increasing collection efficiency will boost MFIs. He further said that increasing rural income will lead to financial recovery. It would not be right to slow down the index from the current level. Government and private capex will increase in the next few times.
Valuations of many midcap stocks still attractive
Valuations of many midcap stocks had become very expensive. Correction in midcap is not much of a worry. There was a lot of correction in the more popular midcaps. Valuations of many midcap stocks still look attractive. Correction is necessary for the long run of the market.
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