INSUBCONTINENT EXCLUSIVE:
Kranthi Bhatini, Equity-Director, WealthMills Securities3 min read Last Updated Aug 12 2024 | 11:26 AM IST
It was an eventful weekend
KRANTHI BHATINI, director-equity at WealthMills Securities, told Rex Cano in an interview that he still recommends equity as the preferred
asset class with significant allocation towards large-cap stocks
Edited excerpts:What's your interpretation of the latest Hindenburg report? Can the events derail market sentiment if things got
uglier?
Things like these, which are either rumours or allegations, at most can impact the market in the short-term; but in the
longer-run, Hindenburg's allegations will not stop India's growth story or the prevailing bull-run in the Indian stock market.What's
your reading of the current market? Preferred sectors?
The Indian stock market has been resilient and resurgent despite the recent
The market has been able to withstand selling pressure backed by strong domestic liquidity flow and upbeat trading sentiment back home
The recent June 2024 quarter corporate results, too, were without any negative surprises, thus creating a positive outlook on earnings
Sectorally, we prefer private sector banks, healthcare and consumer staples
In the medium-term, it is better to avoid shipping and chemical sectors.What are the possible risks that could turn investors cautious on
Indian stocks?
It seems like the equity investment culture has been developing in India like the West
Most of the young investors, the so-called the generation Z, are looking for long-term investment and are confident of a growth in the
DIIs, too, are flushed with liquidity
Any global slowdown, a recession in the US or unstable geo-political environment can make these investors turn cautious towards stock
investments.Do you see higher short-term taxes, new trading derivative / F-O norms impacting the market sentiment and volumes?
We do not
see much impact on the short-term capital gain tax hike on the market, as equity returns in India are attractive both from a short-term and
long-term perspective when compared to other relative asset classes
New F-O trading norms will have some impact on the retail volumes in the derivatives segment, but we need to see at least a couple of
quarters to gauge the actual impact.What would your advice be to investors at such times? Any safe havens where investors can seek
refuge?
There is complete divergence in this market
High price-earnings (PE) stocks remain such stratospheric valuations on the back of strong corporate earnings and robust liquidity flows
Mid- and small-cap stocks, too, have been resilient despite high valuations
Having said that, valuations in the pharma, healthcare, fast moving consumer goods (FMCG) and private bank space seems attractive; whereas,
insurance related stocks look reasonably valued from a medium-term perspective, as do defence stocks
Select defence stocks can be accumulated on dips due to their earnings visibility.In terms of diversification; which are the other assets
that one should consider for investments, say for a 3-5 year period?
We would recommend equity as the preferred asset class with
significant allocation towards large-cap stocks; and timely rotation in mid-caps/ sectors as the crux to generate alpha in the stock market
That apart, investments in gold and silver can help an investor thrive through a low interest environment.First Published: Aug 12 2024 |
