We have been positive on the auto sector. The sector has been plagued by rising costs and a shortage of chips which has restricted capacities. We expect both capacity utilisation and costs to normalise in the coming few quarters.
While there may be some intermittent correction, if one thinks of a long term story, India’s PE ratio seems attractive. Note that the premiums have corrected from the 20s to this level which indicates attractive entry opportunities.
Though macros are a point of debate right now and in the medium term, wealth creation will be function of focusing on micros along with the important ingredients of patience, discipline and conviction
"Rate hikes will have a positive income on the margin profile of BFSI companies depending on asset and liability mix. Similarly, select Pharma companies have a healthy growth profile, with strong balance sheets and cash generation profile."
It’s important to understand the factors driving the FII selloff in order to try and form expectations around when we may expect it to reverse
The influence of psychology on investors’ decision-making still largely explains stock gyrations
The dollar is likely to strengthen more this year on safe-haven demand, particularly if Europe falls into recession. This is a major headwind for emerging markets.
Given the forecast of a normal monsoon, we believe that food inflation will come down and should help bring the CPI back into the RBI tolerance level.
When the circumstances are more conducive, there is a high probability the Reserve Bank will quickly move to an accommodative policy for higher economic growth, says the Fund Manager at Emkay Investment Managers
Geopolitical tensions, rising inflation, tightening of liquidity and Covid-19 disruptions in China have raised market volatility across asset classes, Ravishekar said.
We don#39;t believe that bear market phase is over as the near-term risks might be known but their quantum duration of existence are still unknown, said Varun Lohchab of HDFC Securities
"Considering the demand outlook, product launches, and attractive valuations, we are positive on Tata Motors and Ashok Leyland in the commercial vehicle space, and among ancillaries we prefer Sona BLW Precision Forgings."
"The IPO market premium is primarily linked to the sentiment in the secondary markets. When the markets are euphoric, IPOs demand premium valuations, but no one likes an overvalued company in tough times, especially if the profits are low."
We have been very vocal for the past one year that India deserves a higher PE premium compared to global peers and despite spike in commodity prices, especially oil, India#39;s relative valuation premium remains at historically high levels. We have been very vocal for the past one year that India deserves a higher PE premium compared to global peers and despite spike in commodity prices, especially oil, India#39;s relative valuation premium remains at historically high levels.
"From a valuation standpoint, the last two years of rally had stretched valuations of most good quality businesses and a consolidation may be good for stock prices in the long run."
The most attractive would be private sector banks given that credit offtake is improving, NPA (non-performing assets) cycle has turned and corporate balance sheets are also healthy.
For long-term investors, India is an attractive investment destination and short-run corrections are opportunities to increase equity investments. For long-term investors, India is an attractive investment destination and short-run corrections are opportunities to increase equity investments.
India#39;s manufacturing sector is poised to benefit from the ongoing government#39;s emphasis on indigenization through the PLI programme spreading across the sectors. Further post-COVID China Plus strategy adopted by many companies to extend value chains to secure supply chain and improve scale and profitability. India#39;s manufacturing sector is poised to benefit from the ongoing government#39;s emphasis on indigenization through the PLI programme spreading across the sectors. Further post-COVID China Plus strategy adopted by many companies to extend value chains to secure supply chain and improve scale and profitability.
"We expect FY23 earnings to get marginally affected owing to a rise in crude oil and input cost. Longer than expected lockdown in China has hampered the global supply chain. If the situation persists we might have to lower our earnings expectations at least for the first quarter of FY23."
We are comfortable with growth prospects in the IT sector in the medium term, but valuations comfort had been eroding due to sharp run up. If the current correction in IT continues it will offer a good entry point.
Celebrated short-seller and permabear Sharad Shah says there is still plenty of room for downside
Even with slightly higher interest rates, there are still no viable long term investment options that are capable of beating inflation in a sustainable manner.
Inflation continues to be a major headwind for markets. Consumer inflation in the US in April coming at 8.3 percent reinforces market#39;s concern about aggressive rate hikes by the Fed and the possibility of a US recession in 2023
One can play selectively in IT stocks post correction as a rupee depreciation will benefit them; companies with lower exposure to Europe will be the preferred play as the Euro has depreciated, says Tiwari. One can play selectively in IT post correction as INR depreciation will also benefit it. Companies having lower exposure to Europe will be preferred play as Euro has depreciated.
We are positive on the credit growth prospects in the medium term as we see a reasonable chance of a private sector capex cycle over the next two to three years.
"Investors need to stay with quality stocks, especially ones with stable cash flow and unleveraged balance sheet. The continuous correction in market will see a sell-off of speculative stocks that have weak fundamentals and the damage there will be irreparable." "Investors need to stay with quality stocks, especially ones with stable cash flow and unleveraged balance sheet. The continuous correction in market will see a sell-off of speculative stocks that have weak fundamentals and the damage there will be irreparable."
Holland says the global markets may see a further fall of 5-10 percent, as the narrative has changed from #39;buy on dips’ to ‘sell on rise’ Holland says the global markets may see a further fall of 5-10 percent, as the narrative has changed from #39;buy on dips’ to ‘sell on rise’ Holland says the global markets may see a further fall of 5-10 percent, as the narrative has changed from #39;buy on dips’ to ‘sell on rise’
For auto sector, order books are huge due to pent up demand and also due to supply constraints. Complete opening up of service sector and demand for personal mobility will keep the sector demand healthy. For auto sector, order books are huge due to pent up demand and also due to supply constraints. Complete opening up of service sector and demand for personal mobility will keep the sector demand healthy.
Instead of always focussing on getting the timing right, a staggered or SIP approach can work really well for women.
In the near term, it is likely that global uncertainty would continue resulting in some degree of market volatility.
Given the recent actions of the RBI, inflation control is now a clear priority for the central bank, and that could impact liquidity and optimism in the domestic market, says the MD CIO of ITI Long Short Equity Fund.
With balance sheets of banks, companies in good shape and profits of companies recovering strongly, Jain sees the beginning of a new cycle With balance sheets of banks, companies in good shape and profits of companies recovering strongly, Jain sees the beginning of a new cycle With balance sheets of banks, companies in good shape and profits of companies recovering strongly, Jain sees the beginning of a new cycle
The RBI doesn’t want to stay behind the curve and let the Indian rupee weaken as the US Federal Reserve raises rates, according to Patel.
The global order is perhaps undergoing a major reset and the picture of emerging global order is incomplete. Consequently, the present global economic, geopolitical and financial conditions are quite uncertain and challenging
The US central bank is expected to raise rates by 50 basis points at this meeting, something it hasn’t done since May 2000. But there might still be room for even more hawkishness, depending on how Powell navigates his upcoming press conference
The business outlook for the IT sector continues to be reasonably positive over the next few years. All companies in the sector are looking to grow at double-digit rates for FY23. The business outlook for the IT sector continues to be reasonably positive over the next few years. All companies in the sector are looking to grow at double-digit rates for FY23.
NULL China’s slowdown will compound the challenging outlook for emerging economies facing soaring energy prices and tighter monetary policy from the major central banks, said an economist.
Fed is aware that it is the distortion in supply chain which is contributing to the surge in inflation. Hence, we expect them to be mindful and rationale while doing such rate hikes.
