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The last fiscal was the worst year for the Indian economy since Independence, but it was the best one for equity investors. What strategy should investors follow if there is a correction or a crash? ....
Broader market stock bets: Don't say no to mid & smallcaps yet; analysts say these 21 are roaring buys indiatimes.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from indiatimes.com Daily Mail and Mail on Sunday newspapers.
Capacity expansion, deferred capex from last year and investments driven by the governments production-linked incentive scheme will be the three key capex drivers, experts said. ....
“Upper limit for qualifying as a midcap stock crosses an all-time high of $5 billion last seen during May 2018 and is up 5 times from the taper tantrum lows of $1 billion. Upper threshold for smallcaps at $1.6 billion is still below the level seen in January 2018 level of $1.8 billion,” said Vinod Karki and Siddharth Gupta of ICICI Securities. The Amfi classification tags top 100 stocks by average marketcap between January and June as largecap, next 150 as midcap and the rest as smallcap. Interestingly, two of the newly listed stocks IRFC and Indigo Paints will debut directly as midcap stocks in the Amfi list. Other new listings are expected to classify as smallcaps. ....
“And therefore the possibility of an earnings downgrade as we move forward is quite high. Some of the banks like HDFC Bank and ICICI have already made some provisions for the second Covid wave and we expect more will downgrade their earnings if we fail to contain the pandemic quickly,” he said. Cuts in earnings expectations make the markets look expensively valued. Analysts had justified steep valuations of shares of several companies on the back of cheerful earnings estimates. If expectations are lowered, valuations will become even richer, making stocks vulnerable to sharp corrections. The estimated price to earnings (PE) ratio, a popular valuation measure, stood at 19.95 times against the 10-year average of 17.66. MSCI Emerging Markets’ estimated PE is 15.20 times compared with its 10-year average of 12.38. ....