Market may rally 8-10%; bet on consumer stocks: Ramesh Daman
Posted: Thu Jul 26, 2012 3:55 am
While most analysts expect the market to remain weak at least in the short term, Ramesh S. Damani, member, BSE, feels that the market may rally 8-10 per cent from the current levels. “Markets are likely to sustain the support levels. I would prefer to remain invested,” he said in an interview to NDTV Profit.
The BSE Sensex traded flat on Thursday, while the Nifty held on to the 5,100 mark. The rupee saw small gains against the dollar. The currency was trading close to a month’s low on Wednesday at 56.3725/3775 against Wednesday’s close of 56.12/13. Damani feels that declining rupee and falling crude oil prices will help equities. “Indian equities have become cheap for foreign institutional investors (FIIs) since the rupee has fallen significantly,” he said.
“Reforms are likely to boost markets. However, we don’t expect the Sensex to break above the 21000 level,” he added.
Damani is bullish on consumption-oriented stocks, which he thinks are in good demand. He said that a free cash flow is a biggest positive for consumer stocks. “Consumer businesses are strongly related to the prosperity theme. Examples like telecom successes point to a consumer theme,” he explained.
He prefers investing in stocks with high dividend field. “Market will continue to reward positive first quarter results,” he said.
He further said that apart from consumer stocks, good quality infrastructure stocks are available at attractive valuations. “Still, several infrastructure stocks may remain undervalued,” he added.
He maintains a hold rating on Castrol and Sundaram Finance.
visit: http://www.stocktaj.com for Commodity Market Tips
The BSE Sensex traded flat on Thursday, while the Nifty held on to the 5,100 mark. The rupee saw small gains against the dollar. The currency was trading close to a month’s low on Wednesday at 56.3725/3775 against Wednesday’s close of 56.12/13. Damani feels that declining rupee and falling crude oil prices will help equities. “Indian equities have become cheap for foreign institutional investors (FIIs) since the rupee has fallen significantly,” he said.
“Reforms are likely to boost markets. However, we don’t expect the Sensex to break above the 21000 level,” he added.
Damani is bullish on consumption-oriented stocks, which he thinks are in good demand. He said that a free cash flow is a biggest positive for consumer stocks. “Consumer businesses are strongly related to the prosperity theme. Examples like telecom successes point to a consumer theme,” he explained.
He prefers investing in stocks with high dividend field. “Market will continue to reward positive first quarter results,” he said.
He further said that apart from consumer stocks, good quality infrastructure stocks are available at attractive valuations. “Still, several infrastructure stocks may remain undervalued,” he added.
He maintains a hold rating on Castrol and Sundaram Finance.
visit: http://www.stocktaj.com for Commodity Market Tips