vinsu said:
Yes Pankaj ,
That was exactly my point. Here we are ( u ,me & like minded people ) who believe in India Story and take till "fall" as correction to collect good stocks when the buying time comes . Your FII figures posted regulary do indicate that the FII are buying under the table ( they are talking about over-valuations from the mouth , but buying slowly ).
This interview i take as an effort to put forward the idea that this "bear market " may continue till October End, so as to create more buying oppurtunities on the way for our FII friends .
And for the results season , how do you think , Second Quarter results might do some damage control .
regards
Vinsu Japan
That timing is such that it would give rise to suspicion. Therefore ,I have also given something from Jubak who had earlier given the theory regarding japan , liquidity and risk perception in emerging market and earning over-estimation in EMs.
As for the result season , that is going to be stock and sector specific. traditionally oil related companies producers, marketeers refiners all will be under tremendous pressure. Banks may not do well if interest rates keep going up as loan disbursal will be reduced. NPA may then increase. Working capital interest will be higher. Companies are mostly sitting on huge funds. They may not go for big dividends as in the past but use the cash to fund their growth. Margins will be under pressure for Banks.
Commodities are in long term upswing and somwwhere I read it is 3rd year of six year cycle so another three year. But I think it is picking up. Retail space is yet to be explored. FIIs have beeb permitted with certain caveat. This may see growth but fraught with uncertainties. FMCG has attracted attention now. Brands have occupied center stage. So they will show good. particularly HLL ITC.
Infrastructure will be fine. Capital goods and engineering companies should do well if growth rate continues but if demands fall in overseas market we may see below expectation performance. So lower your expectation. However Govt. speding is slated to go up on big projects. You see when politicians feel euphoric they spend money on bigger projects and bigger welfare schemes. State Govts are flushed with fresh funds from many sources other than taxes. So feel good factor will continue for some more years.
In short, result for both first and second quarters will be better than average in some sectors with large cap showing better than expected results. Mid caps and smlcps will also show good results. But for last two years they had good run . that may not continue and pressure of increased charges on funds will tell on their margins. Only those who improve their bottomline will manage better than expected result. AS expectations are huge for them they may be underperformer.
Well well I am not a pro. So any sentence that looks like pro please disregard.
pankaj