Which Sectors Will Lead the Next Rally? ft. Mayuresh Joshi | CA Rachana Ranade
Published: 2025-03-07
Status:
Available
|
Analyzed
Published: 2025-03-07
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 10
Prediction
Topic
Status
The Indian economy is expected to experience exponential growth in consumption and increased manufacturing, leading to a larger global market share in the coming years. Despite potential market drawdowns, the long-term growth story for India remains optimistic.
"the consumption story is expected to grow exponentially in the Indian context. manufacturing which has taken a good strong foothold expected to increase and in terms of our own PPP right we are already there in the top four because of all these factors put together we'll obviously be having a larger share in the next few years so backdrops draw Downs will persist but the India growth story continues so I think I remain extremely extremely evolu and optimistic on India over the medium time"
Correct
For the past four years, the Indian stock market has experienced a predominantly one-way upward trend, with minimal corrections that were quickly followed by bounces, indicating a strong bull run.
"so the last four years frankly the market has been on a oneway spree right except in June uh till September and December to March of that year when you saw draw down happening into the market but large part of the last four years the market has given a oneway linear move hardly the Nifty has corrected by 5% maximum until the recent correction and the bounce back came back immediately the next day"
Correct
Historically, over the last 20 years, the Sensex has finished the year with a positive return in 17 instances, even in years that experienced internal drawdowns.
"if you go back in history right so we put out a very interesting graph where we've analyzed how the sensex has behaved in the last 20 years and surprisingly RNA I think in the last 20 years 17 years the sensex has given a positive return even if there has been a draw down internally in that year itself"
Correct
Despite a recent 15% market correction, particularly impacting small and mid-cap stocks, the period of 2004-2008 is highlighted as one of the most significant bull runs, suggesting potential for recovery.
"we are down 15% very frankly right uh uh is there worst that might probably happen small cap midcaps have been hit even more yeah so I will take you to the phase right uh I mean if uh in long-term investors who were there in during that phase 2004 to 2008 was one of the biggest bull runs that that we probably had witnessed"
Correct
The Indian market experienced a significant run in the last four years, leading to higher valuations and a build-up of 'froth'. Returns that typically take 10-12 years were achieved in 2-3 years, implying that such rapid returns are unlikely to continue at the same pace.
"so the last four years we had a tremendous run yeah valuations had become a little bit more expensive for the market there were no two ways about it uh main index including the broader markets and therefore I think a lot of fro had genuinely built up for the markets people who had gotten and stayed put with their investment specifically in the broader markets a eight time 10 time 12 time return which you know happens over 10 or 12 years happened in two or three years right so the appetite of assuming that that returns will keep on coming at the same Pace unfortunately it will not happen in the market"
Correct
Future drivers for the Indian market include a resurgence in earnings, exponential growth in consumption, and a strengthening manufacturing sector. These factors are expected to increase India's share in global PPP in the coming years.
"the biggest drivers for the Indian markets as we discuss ahead will be earnings which should come back the consumption story which is expected to grow exponentially in the Indian context manufacturing which has taken a good strong foothold expected to increase and in terms of our own PPP right we are already there in the top four because of all these factors put together we'll obviously be having a larger share in the next few years"
Correct
FIIs were betting on India due to its high earnings growth potential compared to other global economies facing issues. However, the recent slowdown in Indian market growth raises questions about whether it's structural or cyclical.
"what the FIS were betting as a premium to the India story was that earnings growth will continue and that 20 25% Which is far High than any economy in the world China is in a mess USB Europe has core inflation problems Europe is grappling with still uh post-war issues inflation issues core inflation issues ETC and a lot of the Southeast Asian economies that we track also their economies are not that large as India is and therefore I think if you look outside the mother Market which is the US market outside China and let's leave aside Japan so X Japan for the time being I think the Indian market growth has come off but is it structural or is it cyclical"
Correct
Government measures, including tax cuts, are expected to boost Q4 GDP, with Q1 showing increased consumption and spending, and hopefully investment. This suggests corporate performance is nearing a bottom.
"the government has done the right measures I think Q4 GDP bump because tax cuts that has happened q1 you will see consumption and exponential spending coming through and Investments hopefully coming through as well and therefore corporate are things bottoming out"
Correct
There's an inverse relationship between the Dollar Index and the Nifty. A 5-10% increase in the Dollar Index can lead to a 5-10% correction in the Nifty.
"typically throughout 23 and 24 the intermittent Corrections that we saw the dollar Index hit 1056 yes and when it hit 1056 it probably PL out or resistance in in Market lingo it probably hit that resistance and it came now the shares are very unique relationships with how Nifty moves right when the dollar Index moves higher which means that if it is at 100 if it goes to 105 and if Nifty at that point of time is at 100 it will move to 90 so what I'm saying is it's an inverse relation so a 5 to 10% dollar Index move will might and might mean a 5 to 10% correction in the Nifty"
Pending
The Dollar Index is currently at 107, having hit a high of 110 and breached its 21 and 50 moving averages. A continued decline in the Dollar Index could lead to a reverse movement in the Nifty, potentially signaling a market bottom in the coming weeks or months.
"as we stand the dollar Index is at 107 it has hit an alltime high of 110 it has breached its 21 and 50 moving the average and again I think a lot of Institutions for for your investors at large because we track Global markets we speak to a lot of global institutional investors as well they track technicals as well right and they track technicals very very closely so if it is breached at 2150 moving average if it is coming off I think it becomes a very poent sign if it starts coming off even more that inverse relation in Nifty might start happening and maybe the next few few weeks or months as one common indicator or one parameter that you are tracking maybe the bottom is probably close"
Incorrect
Potential leading sectors for the next rally include: 1. Rural theme (agrochemicals, fertilizers, farm equipment, seed companies). 2. Healthcare/hospitals. 3. Selective EPC players, water treatment, and cement companies (despite some market skepticism on capex). 4. Selective financials, with a leading underperforming bank showing strength.
"three or four sectors are actually coming up one obviously the entire rural theme is coming up uh into our sector Focus lists so you might include stocks which are agrochemicals you might include stocks which are fertilizers tractor or farm equipment makers seed companies shrimp farm makers so I've given you a whole host of names that are actually getting thrown out through our list so rural becomes one area which is clearly getting thrown out second I think healthare stroke uh uh hospitals a large part of this universe is actually getting thrown out and if you probably analyze and dissect Q3 numbers uh I think they're looking reasonably placed third I think everybody's talking about why kex and why kex should not do well I think we Divergent views because the budget itself has thrown R very frankly if you add supplementary grants it's a seriously good number so I think the markets are getting it wrong somewhere is is what I feel maybe I'm completely wrong but but time will tell uh but selective um EPC players selective water treatment companies selective cement companies are actually getting thrown out in terms of ours RS ratings uh and fourth I think selective financials"
Pending
A key indicator of a fundamentally strong stock is consistent earnings or Topline growth exceeding 20-25% for the last three quarters and the past three annualized years.
"the first aspect that you're looking at is that the the earnings growth or the Topline growth has to be more than 20 25% for the last three quarters and for the last three annualize years as well"
Pending
Companies with superior profit margins compared to their sector peers are better equipped to navigate cyclical downturns and adapt to industry challenges.
"the second element is that the margins have to be very very Superior uh compared to the rest of the pack in the sector that it probably operates uh so if it has got Superior margins you're very well assured that even when an industry or a sector probably goes through a cyclical downturn these companies know how to adapt these companies know how to adapt themselves"
Correct
Similar to topline growth, earnings growth should also be consistently around 20-25% over the last three quarters and three years. A Return on Equity (ROE) of 17.5% is considered a benchmark.
"third the earnings growth similar to poline growth has to be very very similar uh to 20 25% last three quarters last three years and the Roe as a benchmark that we probably putting in is at 17 and a half%"
Pending
Key qualitative factors for strong stocks include manageable debt levels, absent or minimal promoter pledges, and absolutely bare minimum contingent liabilities.
"the additional layers that we' put through is promoto pledges u high levels of debt I think debt levels have to be very very manageable uh promoter pledges have to be absent and if promoter pledges are properly there absolutely minimalistic third contingent liabilities have to be absolutely bare minimum uh because there is a huge element of contingent liabilities on their balance sheet"
Pending
Key macroeconomic indicators for identifying a market bottom include the fiscal and current account deficits, which are reportedly on a favorable path, with government capex expected to continue at a good pace.
"so if you probably look at the macro picture right uh there are three four elements that probably happen as far as the Indian economy is concerned and just let's talk about the Indian economy that's where we are interested in uh one in terms of our deficits both fiscal as well as current account deficits how are they placed so the Finance Minister the ex cheer has very very suckly put it in the budget right now that we're on the fiscal path and that government capex is going to continue at a good pace"
Correct
Despite potential economic slowdown concerns, tax collections are expected to remain robust. A significant amount of money entering the system due to tax cuts will likely be either saved or spent, impacting the economy.
"tax collections might continue at Ro Bas now there might be question marks that if the economy is slowing down and with the tax cuts a large part of the heavy lifting will have to be done by select individuals as far as direct tax is concerned and what happens to GST the economy probably slows down with the tax cuts coming through I think one lakh CR into the system will basically mean that a large part of that pool will either get saved or a large part of that pool will get spend in the system"
Correct
If a portion of the tax-cut influx is saved, it could go into fixed deposits, PPF, or return to markets via ETFs. This influx of deposits could also benefit the banking system, especially with potential interest rate cuts from other global central banks.
"now let's assume Nobody Knows the figures whether it's 20 80 30 40 but let's go with the ratio of 40 60 where 40% might get saved 60% might get saved uh spent in the economy if 40% gets saved wh those savings go right either it goes into fixed deposits ppf or it comes back to the markets in form of ss uh so either or I think uh the banking system which was affected because of lower deposit growth has larger deposits coming their way because interest rate Cuts as we are seeing it because the US might delay it the rest of the globe is M might going to delay it as well would mean that there might be accre toward deposits"
Correct
Increased spending, driven by tax cuts, will have a significant multiplier effect, boosting GDP and private capex. This, along with improvements in investment and consumption, is expected to drive GDP growth to improve in the second half of the next fiscal year.
"the second aspect obviously here that we speaking about is the spending element and if spending comes through the multiplier effect is huge because that gives boost not just to our GDP but it also gives boost to private capex to come through which has been lagging so if these elements starts coming through the three engines that we speak about in terms of Investments consumption and expenditure I think all these three elements that support GDP will start coming back and GDP which has been languishing at a micro level at a macro level at around 6 .2 will start showing signs of improvement as we head into the second half of the nextal year"
Correct
As earnings improve, the market will re-evaluate numbers, leading to a bull case. This recovery in earnings is expected to attract FIIs back to the Indian market, given its economic, political, and regulatory stability, with commendations for the RBI and SEBI's market regulation.
"earnings which had slowed down will start coming back as well right so as earnings starts coming back uh uh the markets function in terms of reating of numbers and markets are always do four quarters quarters down the line put make a bull case so we'll make a bull case and a base case at that point of time that you know Market earnings are improving and next year it will be even more as you said the base for the first half will be lower next half's base will be even higher correct correct so earnings coming back will mean that FIS will have no choice F will say Indian market where is the other option that is available at this point of time where there is economic stability political stability uh regulatory stability and we should actually commend both the RBI and sebi for doing a good job in terms of how they have regulated the markets"
Correct
A decline in earnings has led to a lower Price-to-Earnings (P/E) multiple for the market, bringing it closer to 15-year averages, which makes it more attractive from an earnings perspective.
"earnings have clearly come off which means that the price earnings multiple has also come off at this D and we are close to 15E averages as we speak so it becomes even more attractive from an learnings perspective"
Correct
Macroeconomic factors suggest that a market bottoming process could begin in the first quarter, with the expectation that by next year, India will have achieved positive Sensex returns in 18 out of 21 years.
"so I think the placement that we have macro wise translating into micro might actually relate that as we had as I said next few weeks but if we go through this periodicity of pain and survive this which we should I think as SE in I think the first quarter say I think bottoming process start and I'm pretty sure that when we speak again I think hopefully next year definitely we will out of 21 years we'll be saying that 18 years the s six Clos in the P"
Correct
Investors should exit fundamentally weak stocks, especially those that were heavily weighted in mid-caps and small-caps during the last rally. The market this year is expected to be driven by domestic stories.
"if a large part of your portfolio mix if it was skewed towards midcap lar which has been the case again as we've seen that in the last three years four years in the next rally which comes through right uh uh the weak stocks or stocks which are fundamentally not strong you please get out of that so I think that is the most sincere advice that I can give you but again I think a large part of the market this year will move as I said as as our our software is throwing out is towards domestic stories largely"
Correct
In typical market cycles, large-cap stocks usually lead the initial phase of a rally due to investor confidence. Mid-cap and small-cap stocks, which are known for multi-bagger potential, tend to follow with a lag of one to two quarters.
"typical Cycles if you look at Cycles again right and if you go at in past history in how Cycles have behaved the first move will always be led by large caps so large caps will lead the first move for the markets because the confidence is still not there right the confidence is still to be with large caps once that confidence comes and the market has moved a good 5 6 8% the large caps have moved 10 15% to a certain extent again hypothetical numbers is what I'm putting through the confidence in midcaps and small caps starts coming back uh and again I think the kind of beta that you create Raj I think all of us are aware right multi Baggers com in from the midcap and the small cap Universe yes the time will come but the midcap small cap L always comes with a quarter or couple of quarters lag effect compared to the L"
Correct
For lump-sum investments made now, it's advisable to deploy the money in three tranches. Invest one tranche, and if the market corrects further, invest another, and then a third. This approach averages out the purchase cost and reduces the impact cost compared to investing the entire sum at once.
"whether you should be putting lumpsum if you have not invested uh just as a coral to your question at this juncture uh if you've got the money at this point of time the option would be to probably have it in three tranches have one tranch if it corrects further one more tranch if it corrects further one more tranch so I think you're safely assuming that your Lums are also getting averaged out uh and your impact cost is relatively lesser uh because your lome investment will have that any effect immediately a SI probably has that in a calibrated manner"
Correct
A multi-asset allocation strategy is recommended for direct equity investments. While equities are expected to perform well over the next 8-10 years, diversification into bonds and gold ETFs can act as a hedge against equity downturns and protect against downside risk.
"the second in terms of your direct Equity investment again I think it should be a multi-asset allocation strategy that you should be deploying and why I'm saying this is equities will do well over the next 8 to 10 years but again as a diversification it's always better that a part of your portfolio happens towards bonds a part in terms of either gold ETFs as an example because they become a sort of a hedge when equities are not doing well and protect the kind of downside risk or brw Downs that get felt in in terms of watching your portfolio zeroed when the Market's"
Pending
The current market correction has lasted 152 days, which is significantly longer than the historical average correction period of 88 days, and is approaching the duration of the longest historical correction (188 days).
"the average correction for the market has been 88 days 88 88 days right the maximum correction was from March 15 to September 15 which lasted 188 days that was a continuous period uh where where the correction lasted the least was covid 40 days the current correction has lasted for 152 days right now the Assumption here is that if you go by the average we are already way above average"
Incorrect
Another 23 trading sessions could bring the market closer to its historical average correction duration. A further 5% correction from current levels could lead to an 1100-point drop on the Nifty, potentially bringing it to the 21,000 level.
"so another 23 trading sessions and we'll be close to the longer term hit ratio that we probably done in terms of average draw Downs that same period of March 15 uh to September 15 was a 22% draw down uh the April 22 to June 22 phase was a 15% ra down 18% draw down and at the 15% draw down now if I have to just play with numbers and I'm just purely playing with numbers maximum reach there so even if you assume that you correct 5% more right we are close to 21% Mark a 5% correction more from he's current level I'm not scaring everybody will probably mean a 1100 Point drop on the Nifty right and 1100 Point drop on the Nifty will mean that the Nifty reaches 21,000 in terms of levels"
Incorrect
Consensus earnings estimates for Nifty have been revised down to 1150. With potential tax cuts and stability in PAT earnings (a 5% rise recently), there are no immediate signs of further earnings cliff dives, making the market attractive.
"earnings downgrades is around the pegging was f27 exit number should be around 1200 it has now come down to an average consensus of 1150 now simple 1150 to get your p ratio will come less than 0 times structural draw down there is no other elements that we seeing down the horizon which will make us feel that you know earnings are going down the cliff SCB situation and why I'm saying this is the latest figure on the pat earnings have shown stability last two quarters it was 4% it has shown a 5% rise with the Kum that we spoke the Cuban tax cuts that we saying if there is an increased scope of earnings that is going to come through"
Incorrect
Based on historical worst drawdowns, a further drop of 1100-1300 points on the Nifty would make it even more attractive from a P/E ratio perspective. The speaker suggests a potential drop of 13,500 points, with another 500 points from there, implying a target level around 13,000.
"assuming historically on what you've seen as the worst draw Downs on history that goes by maybe 1100 12 1300 odd points which makes it even more attractive from a Nifty p ratio so to answer your question 13 now 13 500 Point drop one3 another 500 from there"
Incorrect
India is presented as a great long-term story, particularly for younger investors (under 30), with a promising future ahead.
"my belief is that India is a great story uh you guys specifically of your around 30 below 30 I think you've got a great future India is a great great story uh to probably play out with as well"
Pending
The consumption story in India is expected to grow exponentially, manufacturing is expected to increase, and due to these factors, India will have a larger share in global PPP in the coming years.
"the consumption story which is expected to grow exponentially in the Indian context uh manufacturing which has taken a good strong foothold expected to increase and in terms of our own PPP right we are already there in the top four because of all these factors put together we'll obviously be having a larger share in the next few years"
Correct
The market is expected to start its bottoming process in the first quarter, and by next year, a significant majority of years will have seen positive Sensex closing returns.
"as I said next few weeks but if we go through this periodicity of pain and survive this which we should I think as SE in I think the first quarter say I think bottoming process start and I'm pretty sure that when we speak again I think hopefully next year definitely we will out of 21 years we'll be saying that 18 years the s six Clos in the P"
Correct
A 5-10% move in the dollar index can lead to a 5-10% correction in Nifty due to their inverse relationship. With the dollar index at 107 and breaching its moving averages, a decline could signal an upcoming bottom in the Nifty within the next few weeks or months.
"a 5 to 10% dollar Index move will might and might mean a 5 to 10% correction in the Nifty Now as we stand the dollar Index is at 107 it has hit an alltime high of 110 it has breached its 21 and 50 moving the average and again I think a lot of Institutions for for your investors at large because we track Global markets we speak to a lot of global institutional investors as well they track technicals as well right and they track technicals very very closely so if it is breached at 2150 moving average if it is coming off I think it becomes a very poent sign if it starts coming off even more that inverse relation in Nifty might start happening and maybe the next few few weeks or months as one common indicator or one parameter that you are tracking maybe the bottom is probably close"
Incorrect
The rural theme, including agrochemicals, fertilizers, tractor/farm equipment manufacturers, seed companies, and shrimp farm makers, is expected to lead the next market rally.
"three or four sectors are actually coming up one obviously the entire rural theme is coming up into our sector Focus lists so you might include stocks which are agrochemicals you might include stocks which are fertilizers tractor or farm equipment makers seed companies shrimp farm makers"
Pending
Healthcare and hospitals are looking reasonably placed. Despite market skepticism, selective EPC players, water treatment companies, and cement companies are showing strength, possibly due to government budget allocations.
"second I think healthare stroke hospitals a large part of this universe is actually getting thrown out and if you probably analyze and dissect Q3 numbers I think they're looking reasonably placed third I think everybody's talking about why kex and why kex should not do well I think we Divergent views because the budget itself has thrown R very frankly if you add supplementary grants it's a seriously good number so I think the markets are getting it wrong somewhere is is what I feel maybe I'm completely wrong but but time will tell but selective um EPC players selective water treatment companies selective cement companies are actually getting thrown out in terms of ours RS ratings"
Correct
Certain selective financials, specifically a large-cap bank that has underperformed but is now showing strength, could lead the next bull rally.
"fourth I think selective financials uh so I think um one of the leading Banks which is underperformed so far has shown tremendous amount of strength so I think that bank within the large cap names uh can actually be the leader of the next Bull rally"
Pending
Key indicators for market bottoming include positive fiscal and current account deficit trends, along with continued government capex, as stated in the budget.
"if you probably look at the macro picture right uh there are three four elements that probably happen as far as the Indian economy is concerned and just let's talk about the Indian economy that's where we are interested in right uh one in terms of our deficits both fiscal as well as current account deficits how are they placed so the Finance Minister the ex cheer has very very suckly put it in the budget right now that we're on the fiscal path and that government capex is going to continue at a good pace so those two aspects are going to continue"
Correct
GST and tax collections are expected to remain strong. Tax cuts will inject liquidity, with a significant portion likely to be saved or spent, potentially boosting the economy and financial markets.
"GST collection tax collections might continue at Ro Bas now there might be question marks that if the economy is slowing down and with the tax cuts a large part of the heavy lifting will have to be done by select individuals as far as direct tax is concerned and what happens to GST the economy probably slows down with the tax cuts coming through I think one lakh CR into the system will basically mean that a large part of that pool will either get saved or a large part of that pool will get spend in the economy"
Correct
A portion of the injected liquidity from tax cuts is expected to be saved, flowing into fixed deposits, PPF, or the market as equities. This will also increase bank deposits, freeing up capital for advances and investment spending, thus aiding manufacturing.
"now let's assume Nobody Knows the figures whether it's 20 80 30 40 but let's go with the ratio of 40 60 where 40% might get saved 60% might get saved uh spent in the economy if 40% gets saved wh those savings go right either it goes into fixed deposits ppf or it comes back to the markets in form of ss uh so either or I think uh the banking system which was affected because of lower deposit growth has larger deposits coming their way because interest rate Cuts as we are seeing it because the US might delay it the rest of the globe is M might going to delay it as well would mean that there might be accre toward deposits uh and as banking deposits improve I think a large part of that tool might come down in terms of coming back as an asset pool for giving advances for institutions as an investment spend and Manufacturing coming back"
Pending
Increased spending will have a significant multiplier effect, boosting GDP and private capex. All three GDP support engines (investment, consumption, expenditure) are expected to improve, leading to GDP growth above 6.2% in the second half of the fiscal year.
"the second aspect obviously here that we speaking about is the spending element and if spending comes through the multiplier effect is huge because that gives boost not just to our GDP but it also gives boost to private capex to come through which has been lagging so if these elements starts coming through the three engines that we speak about in terms of Investments consumption and expenditure I think all of these three elements that support GDP will start coming back and GDP which has been languishing at a micro level at a macro level at around 6 .2 will start showing signs of improvement as we head into the second half of the nextal year"
Correct
As earnings recover, markets will re-evaluate numbers. Improved earnings and economic/political/regulatory stability in India will make it an attractive option for Foreign Institutional Investors (FIIs) seeking alternatives.
"earnings which had slowed down will start coming back as well right so as earnings starts coming back uh uh the markets function in terms of reating of numbers and markets are always do four quarters quarters down the line put make a bull case so we'll make a bull case and a base case at that point of time that you know Market earnings are improving and next year it will be even more as you said the base for the first half will be lower next half's base will be even higher correct correct so earnings coming back will mean that FIS will have no choice F will say Indian market where is the other option that is available at this point of time where there is economic stability political stability uh regulatory stability"
Correct
India is a great story with a promising future, especially for the younger generation.
"my belief is that India is a great story uh you guys specifically of your around 30 below 30 I think you've got a great future India is a great great story to probably play out with as well"
Correct
For lump sum investments during a market downturn, it's advisable to deploy funds in three tranches to average out costs and reduce impact cost.
"so whether you should be putting lumpsum if you have not invested uh just as a coral to your question at this juncture uh if you've got the money at this point of time the option would be to probably have it in three tranches have one tranch if it corrects further one more tranch if it corrects further one more tranch so I think you're safely assuming that your Lums are also getting averaged out uh and your impact cost is relatively lesser"
Correct
A multi-asset allocation strategy is recommended for direct equity investments. While equities are expected to perform well over 8-10 years, diversifying with bonds and gold ETFs can act as a hedge against equity downturns and protect against downside risk.
"in terms of your direct Equity investment again I think it should be a multi-asset allocation strategy that you should be deploying and why I'm saying this is equities will do well over the next 8 to 10 years but again as a diversification it's always better that a part of your portfolio happens towards bonds a part in terms of either gold ETFs as an example because they become a sort of a hedge when equities are not doing well and protect the kind of downside risk or brw Downs that get felt in in terms of watching your portfolio zeroed when the Markets"
Correct
The market this year is expected to be driven by domestic stories, and a mix of these, along with other mentioned themes, is likely to perform well throughout the current fiscal year.
"so again I think uh a large part of the market this year will move as I said as as our our software is throwing out is towards domestic stories largely so I think domestic stories uh and a mix of that which I just mentioned uh might continue doing well at least for this this fiscal"
Correct
The current market correction has lasted 152 days, which is significantly above the historical average of 88 days. This suggests that the market is already past its average correction period.
"the average correction for the market has been 88 days 88 88 days right the maximum correction was from March 15 to September 15 which lasted 188 days that was a continuous period uh where where the correction lasted the least was covid 40 days the current correction has lasted for 152 days right now the Assumption here is that if you go by the average we are already way above average"
Incorrect
A further 5% correction from current levels would translate to an 1100-point drop on the Nifty, bringing it down to the 21,000 level.
"a 5% correction more from he's current level I'm not scaring everybody will probably mean a 1100 Point drop on the Nifty right and 1100 Point drop on the Nifty will mean that the Nifty reaches 21,000 in terms of levels"
Pending
A further drop of 13,500 points to 13,000, or another 500 points from there, would make the Nifty levels more attractive for investment.
"so to answer your question 13 now 13 500 Point drop one3 another 500 from there but but but one3 now makes sense is what you're saying"
Pending
Investors should exit weak stocks or those that are not fundamentally strong, especially if their portfolio is heavily skewed towards mid-caps and small-caps that have previously performed well.
"if a large part of your portfolio mix if it was skewed towards midcap lar which has been the case again as we've seen that in the last three years four years in the next rally which comes through right uh uh the weak stocks or stocks which are fundamentally not strong you please get out of that so I think that is the most sincere advice that I can give you"
Pending
An appropriate portfolio mix should include a balance of large caps, mid-caps, and small-caps, avoiding over-allocation to any single sector, to ensure diversification and mitigate risk.
"but generally as a construct in terms of a portfolio mix itself I think you should be having a skew of large caps midcaps and small caps in your portfolio and not too much of over allocation towards one particular sector so I think an appropriate mix would be a good mix of large caps largish mid caps and small caps in your over portfolio because if one part of the market is not doing well the other Market might probably some got it"
Pending
During market downturns, continue with existing SIPs. Additionally, incrementally increase SIP amounts each succeeding year to benefit from compounded growth.
"market conditions like this I think you should continue with your si that's Point number one second I think as a step up measure every succeeding year you should probably be having one more sip that probably gets added by one more sip I'm not saying by an absolute amount I think you're having 10,000 rupees worth of sip next year it should be around 12,000 of sip so I think every step up happen every succeeding year because as you continue waging I think that contributes significantly from a compounded growth perspective"
Pending
Fundamentally strong stocks should demonstrate earnings or topline growth exceeding 20-25% for the last three quarters and the preceding three annualized years.
"the first aspect that you're looking at is that the the earnings growth or the Topline growth has to be more than 20 25% for the last three quarters and for the last three annualize years as well"
Pending
Companies with superior margins compared to their sector peers are better equipped to adapt and navigate cyclical downturns.
"the second element is that the margins have to be very very Superior uh compared to the rest of the pack in the sector that it probably operates uh so if it has got Superior margins you're very well assured that even when an industry or a sector probably goes through a cyclical downturn these companies know how to adapt"
Pending
Earnings growth should mirror topline growth (20-25% for the last three quarters/years), with a Return on Equity (ROE) benchmark of 17.5%.
"third the earnings growth similar to poline growth has to be very very similar uh to 20 25% last three quarters last three years and the Roe as a benchmark that we probably putting in is at 17 and a half% as a cancelling feature"
Pending
Fundamentally sound companies should have manageable debt levels, minimal or no promoter pledges, and bare minimum contingent liabilities.
"the additional layers that we' put through is promoto pledges u high levels of debt I think debt levels have to be very very manageable uh promoter pledges have to be absent and if promoter pledges are properly there absolutely minimalistic third contingent liabilities have to be absolutely bare minimum"
Pending
Companies must have no regulatory or compliance issues concerning their management or promoters to be considered fundamentally strong.
"fourth I think from a compliance and a regulatory perspective I think there has to be no element of question marks either on the management or the promoters I think if you got these qualitative uh checkpoints in terms of data points that the stock is delivering through numbers and hygiene checkpoints otherwise I think you've got a good winner on it"
Pending
The speaker is optimistic about the Indian growth story, driven by exponential consumption growth, increasing manufacturing, and a larger share in global PPP. They acknowledge that market drawdowns will persist but believe the overall growth story will continue over the medium term.
"I think the India growth story continues... the consumption story which is expected to grow exponentially in the Indian context... manufacturing which has taken a good strong foothold expected to increase and in terms of our own PPP right we are already there in the top four because of all these factors put together we'll obviously be having a larger share in the next few years so backdrops draw Downs will persist but the India growth story continues so I think I remain extremely extremely evolu and optimistic on India over the medium time"
Pending
The speaker anticipates a Q4 GDP bump due to tax cuts, followed by increased consumption and spending in Q1. They expect investments to follow, suggesting that corporate earnings are bottoming out, and emphasize that markets are driven by earnings.
"Q4 GDP bump because tax cuts that has happened q1 you will see consumption and exponential spending coming through and Investments hopefully coming through as well and therefore corporate are things bottoming out and as we always say in the markets right markets are slave of earnings"
Pending
There is an inverse relationship between the Dollar Index and Nifty. A 5-10% rise in the Dollar Index can lead to a 5-10% correction in the Nifty.
"now typically throughout 23 and 24 the intermittent Corrections that we saw the dollar Index hit 1056 yes and when it hit 1056 it probably PL out or resistance in in Market lingo it probably hit that resistance and it came now the shares are very unique relationships with how Nifty moves right when the dollar Index moves higher which means that if it is at 100 if it goes to 105 and if Nifty at that point of time is at 100 it will move to 90 so what I'm saying is it's an inverse relation so a 5 to 10% dollar Index move will might and might mean a 5 to 10% correction in the Nifty"
Pending
With the Dollar Index at 107 and having breached its 21 and 50 moving averages, a potential decline could trigger an inverse effect on the Nifty, suggesting that a market bottom might be near in the coming weeks or months.
"now as we stand the dollar Index is at 107 it has hit an alltime high of 110 it has breached its 21 and 50 moving the average and again I think a lot of Institutions for for your investors at large because we track Global markets we speak to a lot of global institutional investors as well they track technicals as well right and they track technicals very very closely so if it is breached at 2150 moving average if it is coming off I think it becomes a very poent sign if it starts coming off even more that inverse relation in Nifty might start happening and maybe the next few few weeks or months as one common indicator or one parameter that you are tracking maybe the bottom is probably close as we speak"
Pending
The rural theme, including agrochemicals, fertilizers, tractor and farm equipment makers, seed companies, and shrimp farm makers, is expected to lead the next rally.
"three or four sectors are actually coming up one obviously the entire rural theme is coming up into our sector Focus lists so you might include stocks which are agrochemicals you might include stocks which are fertilizers tractor or farm equipment makers seed companies shrimp farm makers"
Pending
The healthcare and hospital sector is also anticipated to perform well, with Q3 numbers looking reasonably strong.
"second I think healthare stroke hospitals a large part of this universe is actually getting thrown out and if you probably analyze and dissect Q3 numbers I think they're looking reasonably placed"
Pending
Despite some skepticism, the speaker believes the market is misinterpreting the EPC (Engineering, Procurement, and Construction) sector. They see potential in selective EPC players, water treatment companies, and cement companies, citing positive budget allocations and promising RS ratings.
"third I think everybody's talking about why kex and why kex should not do well I think we Divergent views because the budget itself has thrown R very frankly if you add supplementary grants it's a seriously good number so I think the markets are getting it wrong somewhere is is what I feel maybe I'm completely wrong but but time will tell but selective um EPC players selective water treatment companies selective cement companies are actually getting thrown out in terms of ours RS ratings"
Pending
Selective financial institutions, particularly a leading large-cap bank that has underperformed, are predicted to lead the next bull rally.
"fourth I think selective financials so I think um one of the leading Banks which is underperformed so far has shown tremendous amount of strength so I think that bank within the large cap names can actually be the leader of the next Bull rally"
Pending
For a fundamentally strong stock, earnings or topline growth should exceed 20-25% for the last three quarters and for the last three annualized years.
"the first aspect that you're looking at is that the the earnings growth or the Topline growth has to be more than 20 25% for the last three quarters and for the last three annualize years as well"
Pending
Companies with superior margins compared to their sector peers are more resilient during cyclical downturns and possess better adaptation capabilities.
"the second element is that the margins have to be very very Superior uh compared to the rest of the pack in the sector that it probably operates uh so if it has got Superior margins you're very well assured that even when an industry or a sector probably goes through a cyclical downturn these companies know how to adapt"
Pending
Earnings growth should mirror topline growth (20-25% for the last three quarters and years), with a Return on Equity (ROE) benchmark of 17.5%.
"third the earnings growth similar to poline growth has to be very very similar uh to 20 25% last three quarters last three years and the Roe as a benchmark that we probably putting in is at 17 and a half%"
Pending
Key financial hygiene factors include manageable debt levels, absent or minimal promoter pledges, and bare minimum contingent liabilities.
"the additional layers that we' put through is promoto pledges u high levels of debt I think debt levels have to be very very manageable uh promoter pledges have to be absent and if promoter pledges are properly there absolutely minimalistic third contingent liabilities have to be absolutely bare minimum"
Pending
The speaker anticipates a Q4 GDP bump due to tax cuts, followed by increased consumption and spending in Q1. They expect investments to follow, suggesting that corporate earnings are bottoming out, and emphasize that markets are driven by earnings.
"Q4 GDP bump because tax cuts that has happened q1 you will see consumption and exponential spending coming through and Investments hopefully coming through as well and therefore corporate are things bottoming out and as we always say in the markets right markets are slave of earnings"
Pending
Government capex is expected to continue at a good pace, and GST/tax collections are projected to remain strong, indicating fiscal stability.
"I think the Finance Minister the ex cheer has very very suckly put it in the budget right now that we're on the fiscal path and that government capex is going to continue at a good pace so those two aspects are going to continue GST collection tax collections might continue at Ro Bas"
Pending
A significant injection of funds (1 lakh crore) into the system is expected to either be saved or spent. Savings could flow into markets, and improved banking deposits may lead to increased advances and investment spending, supporting manufacturing.
"one lakh CR into the system will basically mean that a large part of that pool will either get saved or a large part of that pool will get spend in the system... if 40% gets saved wh those savings go right either it goes into fixed deposits ppf or it comes back to the markets in form of ss... and as banking deposits improve I think a large part of that tool might come down in terms of coming back as an asset pool for giving advances for institutions as an investment spend and Manufacturing coming back"
Pending
The combination of investments, consumption, and expenditure will drive GDP growth, moving it from 6.2% towards improvement in the second half of the next fiscal year.
"if these elements starts coming through the three engines that we speak about in terms of Investments consumption and expenditure I think all these three elements that support GDP will start coming back and GDP which has been languishing at a micro level at a macro level at around 6 .2 will start showing signs of improvement as we head into the second half of the nextal year"
Pending
As earnings recover, the market will re-rate, and a bull case will emerge based on forward-looking earnings projections.
"earnings which had slowed down will start coming back as well right so as earnings starts coming back uh uh the markets function in terms of reating of numbers and markets are always do four quarters quarters down the line put make a bull case"
Pending
With earnings having come down, the Price-to-Earnings (P/E) multiple has also decreased, approaching 15-year averages, making the market more attractive from an earnings perspective.
"earnings have clearly come off which means that the price earnings multiple has also come off at this D and we are close to 15E averages as we speak so it becomes even more attractive from an learnings perspective"
Pending
The market is expected to bottom out in the first quarter, suggesting that by next year, the Sensex will have closed positively for 18 out of 21 years, despite current market pain.
"as I said next few weeks but if we go through this periodicity of pain and survive this which we should I think as SE in I think the first quarter say I think bottoming process start and I'm pretty sure that when we speak again I think hopefully next year definitely we will out of 21 years we'll be saying that 18 years the s six Clos in the P"
Pending
In a market recovery, large-cap stocks will lead the initial move due to lingering low confidence. Mid-caps and small-caps will follow once confidence returns and the market has already seen a significant rise.
"the first move will always be led by large caps so large caps will lead the first move for the markets because the confidence is still not there right the confidence is still to be with large caps once that confidence comes and the market has moved a good 5 6 8% the large caps have moved 10 15% to a certain extent again hypothetical numbers is what I'm putting through the confidence in midcaps and small caps starts coming back"
Pending
Mid-cap and small-cap rallies typically lag large-caps by a quarter or two. Investors who hold fundamentally strong mid and small-cap stocks that have seen unrealized profits erode due to market sentiment should consider sticking with them as they are expected to recover with the market.
"the midcap and the small cap L always comes with a quarter or couple of quarters lag effect compared to the L got it got it so right now you're saying that I I'll tell you the psyche why I asked this question that if anyone let's say was invested in small caps midcaps and let's say they had seen an unrealized profit of somewhere let's say 70 80% right fundament let's assume that they were fundamentally strong stocks okay yeah with the overall Market sentiment now they are left with barely 5 10% of the profit now now they are not sure that and should we shift it to large caps or still would it make sense sticking out there and be with that specific set set of stocks"
Pending
It's advisable to hold onto fundamentally strong mid-cap stocks, as they are expected to perform well and recover alongside the market, especially if their sector fundamentals remain supportive.
"I think it always makes sense to stick around with those group of stocks because ultimately I think as the market recovers uh uh these stocks will perform because they're fundamentally good stories and even if they belong to the midcap universe I'm not saying Jo right the large the Raja but if you're the second best or the third best you will do well if that sector is doing well assuming that fundamentals are supported for that sector and therefore I think you should hold on"
Pending
A balanced portfolio should include a mix of large caps, larger mid-caps, and small caps to mitigate risks when one segment of the market underperforms.
"so I think an appropriate mix would be uh a good mix of large caps largish mid caps and small caps in your over portfolio because if one part of the market is not doing well the other Market might probably some got it"
Correct
For lump-sum investments, it's recommended to deploy the money in three tranches, investing more if the market corrects further, to average out the purchase cost.
"whether you should be putting lumpsum if you have not invested uh just as a coral to your question at this juncture uh if you've got the money at this point of time the option would be to probably have it in three tranches have one tranch if it corrects further one more tranch if it corrects further one more tranch"
Correct
Continue with existing SIP contributions, and consider incrementally increasing SIP amounts each succeeding year as a step-up measure.
"whether you should be doubling up or not right I think having a systematic plan in place is very very critical market conditions like this I think you should continue with your si that's Point number one second I think as a step up measure every succeeding year you should probably be having one more sip that probably gets added by one more sip"
Correct
A multi-asset allocation strategy is recommended, including equities (expected to perform well over 8-10 years), bonds, and gold ETFs, which can act as a hedge during equity market downturns.
"the second in terms of your direct Equity investment again I think it should be a multi-asset allocation strategy that you should be deploying and why I'm saying this is equities will do well over the next 8 to 10 years but again as a diversification it's always better that a part of your portfolio happens towards bonds a part in terms of either gold ETFs as an example because they become a sort of a hedge when equities are not doing well"
Pending
A further 5% correction from current levels could lead to an 1100-point drop in the Nifty, bringing it down to the 21,000 mark.
"if I have to just play with numbers and I'm just purely playing with numbers maximum reach there so even if you assume that you correct 5% more right we are close to 21% Mark a 5% correction more from he's current level I'm not scaring everybody will probably mean a 1100 Point drop on the Nifty right and 1100 Point drop on the Nifty will mean that the Nifty reaches 21,000 in terms of levels"
Incorrect
With Nifty earnings at 1150, the P/E ratio would be less than 20. The speaker does not foresee a cliff-like decline in earnings, noting stability and a 5% rise in PAT earnings, potentially bolstered by tax cuts. They suggest that historical worst drawdowns of 1100-1300 points make the Nifty more attractive from a P/E perspective.
"simple 1150 to get your p ratio will come less than 0 times structural draw down there is no other elements that we seeing down the Horizon which will make us feel that you know earnings are going down the cliff SCB situation and why I'm saying this is the latest figure on the pat earnings have shown stability last two quarters it was 4% it has shown a 5% rise with the Kum that we spoke the Cuban tax cuts that we saying if there is an increased scope of earnings that is going to come through I think down assuming historically on what you've seen as the worst draw Downs on history that goes by maybe 1100 12 1300 odd points which makes it even more attractive from a Nifty p ratio"
Incorrect
A further drop of 1300-1500 points from current levels is considered a sensible entry point.
"so to answer your question 13 now 13 500 Point drop one3 another 500 from there but but but one3 now makes sense is what you're saying"
Incorrect
Investors should maintain faith in the market, as cyclical phases are normal. India is presented as a great story, suggesting long-term positive prospects.
"keep faith in the markets we always go through these phases it's not unique that the markets will go through what we are going through at this juncture why I'm smiling is because because my belief is that India is a great story"
Correct