Nifty PE @26.1

Nifty PE stands at 26.1 at present. It may well be thought that its at a high point historically and might see correction. But there are some facts that justify it. First, since the bench-mark interest rates are low the PEs would tend to remain high. Secondly, some factors like NPAs of the banks, price-war in telecom sector etc have kept the earning of a lot of companies in Nifty at very low level which ought to improve with passing of time. So, a serious investor shouldn’t get too worried or too reserved, India story will remain good till present dispensation holds the reins of government.

Krishna Khandelwal

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