panch-tattva talk…advantage india


The Indian stocks have performed best during last twelve months. The Indian stocks will be the leaders as far as returns go, for the next 12 months at least. Now, after some confirmation you would be able to take my suggestion that the previous all time high is not difficult to be breached by leading Indices here.

There has been an explosive sort of reaction in world’s leading markets during last twenty four hour when we were closed. This may be on account of the positive vibes coming out of the G-20 meet at Pittsburg where the dissenting voice is quite feable. I had occassion to tell you that China may not see the stock price movement in line with rest and particularly India. Today that happens to be the sole market in the red. The Nifty is trading past 5000 mark in Singapore this morning, gaining more than 40pts. I would still say that the investors here should be maintaining their equity investment at between 50 to 70pc of investible whole. This is necessary to keep the fear element out and the to remain ready for buying just in case there is some extra-ordinery movement on down side by way of knee-jerk reaction. The fundamentals of Indian economy will not be dented in a short time because of its unique positioning.

As for the sectors, I would say that ‘auto sector’ has entered risky waters in terms of pricing of stocks. The cement sector remains a good bet for investment and so is banking sector. About capital sector I would say that those who have nerves of steel and would not be disturbed for any small loses, may surely invest in leading infrastructure companies like L n T, BHEL,ABB and a few other construction companies. The IT sector is now fit for moving out on rises and entry on declines. Realty should be shunned unless you have specific knowledge about some company expected to do better in near future, these stocks should not be looked at for investment of long term nature. The Pharma sector in OK and should form part of portfolio without over-weightage. The telecome sector has big promise but entails some risk due to ongoing price war. I feel rather uncapable of speaking surely for refineries and petroleum but stocks like ONGC have potential of going up, may be substatially too. Steel remains my favourite sector for some more time till the full price potential is achieved. The present day P/E ratios are around 26 for Auto,around 10 for Banking,around 10 for Cement, around 30 for Cap-Goods, around 20 for IT, around 25 for Pharma, around 10 for Steel and around 15 for Telecom.

So, please be ready to take part in action.


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