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“Across the board, I do not think there is any sector which is highly overvalued per se. But in two to three sectors, especially the external facing ones, like chemical and software, an investor needs to be a bit cautious. I would like to remain underweight in these two industries.”
“I really do not understand the global setup, the way it is, and why FII selling continues despite India shining and despite so much positive news globally on India. That is a difficult phenomenon to understand. And yet domestic flows remain extremely strong. So this is the time to focus on individual stocks rather than the market as a whole. ”
"The case with L&T and some of the other largecap companies is that relentless FII selling is keeping their stock prices pinned down. So what if it is 24-25 times, 26, 25 earnings, it is a great buying opportunity and that will support further appreciation in the stock price. So rather than analysing why it is available at attractive valuations, I would say that it is a good entry point. Again, a disclosure, we and our clients are invested in it."
And I think that is what is happening. And this will continue, I think, till we see some sort of shakeout within the banking sector or the NPA cycle starts to pick up, which is when the smaller banks will feel the pain far more than the larger banks.
On Dalal Street, investors are betting big on the boom with the Nifty Realty index now trading at 15-year high levels.