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While every sector of the economy has been witnessing an improvement and policy push, one sector which was the first one to come in the focus of the government was the road construction sector. At first, it was the central government, but if one looks at how important it has become for gaining political capital, every state government has been focusing on road and highway construction. The impact of a coordinated effort between state and central government is that the lead time for the construct...

It is day like today when all the indices are trading in red and the leading the fall are mid and small-cap indices, and market breadth is extremely that a large number of investor look at their phones to check how is their portfolio doing, In all probability a large majority finds the decline in their portfolio is more than what Nifty has suffered and that where the doubt and question come to mind. Now two things, especially for those who have turned bulls in the last few months. First nifty or...

Banking sector is probably the best proxy play to the Indian economy. The reason, banks provide the lifeline of capital to all the sectors which form part of any economy, whether it is retail loans or corporate loans. So when these sectors do well, banks have a higher credit growth. So, if the economy is likely to grow faster than there is no way banks are not going to do well. Because there is a certain amount of ownership overhang in private sector banks and also the fact that voices from Indi...

On a day when the majority of the stocks are trading with a cut, one set of stocks which have been able to log in gains has been from a space which cannot be very clearly defined. The reason, what would you call a company which makes both, water geysers , and electrical wires, a white goods or electrical goods company.From the year 2015 to 2020, companies with strong brands in different sectors which were considered as commodity plays got re-rated by the street. The expansion in price earnings m...

In the last year, the differential in valuation between, mid and largecap stocks has increased very sharply. This differential is even more striking given the fact it has come even in spaces like private sectors which have been getting premium valuation for decades. If the market remains under the control of bulls there is a probability that over the next few quarters, markets may see a mean reversion. It might happen both ways, midcap witnessing some profit booking and large caps doing relative...

In the last two months of the market, while the midcaps have done well, though the pace at which the outperformance was taking place has slowed down. So, there is a profit booking taking place in different parts and sectors. Part of this profit booking is due to the fact the valuations are high and probability that it would continue. At this point of time one should also focus on reducing risk.In reducing market risks, investors should integrate both quantitative and qualitative criteria to asse...

In a sector, where government policies have a major impact, the risk of any change in policy impacting the players is always present. That is the reason why the valuations of these stocks from such sectors dont cross a certain threshold. Probably the sugar sector tops the lists of such sectors and the reason is because both the central and state governments have some say in the policy making. Recently, there was a tweak in how much sugar cane juice can go for ethanol production and now a rise in...

As the Dalal street continues to be in party mode with minor correction and sectoral profit booking taking place, staying bullish would appear to be the most logical thing at this point of time. Why fight against a trend? While staying bullish, just add an element of caution. When we use the word caution, we mean stay with quality and especially if one is increasing exposure in midcap at this point of time. Use more stringent filters to pick stocks and cut the element of noise from investing. Qu...

As other sectors dominated by PSU companies come into limelight, defence stocks which ignited the re-rating of PSU stocks have moved into consolidation mode for some time. The question is whether the business is in consolidation mode or not, the answer is tilting toward no. It appears the underlying developments in the sector continue to be going at the same pace or rather even more. Allowing 100 % FDI in space related industries, is probably an indication that focus on defence and related secto...

While nifty slipping from the high of the day and ending in red territory is nothing new, it keeps happening. But this Friday it took place with PSU banks leading the profit booking move. This profit booking coming in the space which has done well in the last few weeks, tends to create more short term disturbances. There is a probability of a further selective correction taking place. In this period stocks where there are some improvements in the business operating matrix tend to weather the sto...