Why Shankar Sharma Does Not Prefer A Bull Run

Nothing can really disturb the young Indian bull market right now, according to the founder of GQuant Investech.

Sharma, however, prefers the bear market as it gives an investor time to understand companies and businesses. In a bull run, investors become lax in their techniques, he told BQ Prime's Niraj Shah. "I think, you can build a better portfolio in a bear market."

Nothing can really disturb the young Indian bull market right now, according to the founder of GQuant Investech.

Sharma, however, prefers the bear market as it gives an investor time to understand companies and businesses. In a bull run, investors become lax in their techniques, he told BQ Prime's Niraj Shah. "I think, you can build a better portfolio in a bear market."

"Small caps are always called devils until proven otherwise," Sharma said.

Given the size of India's gross domestic product, now it can afford huge growth opportunities for smaller companies within India itself, he said.

As India is now a big market, having business all across the world, small caps are performing better, he said. "They are addressing the whole country in their recent ride and are now getting an addressable market."

The NSE Nifty Smallcap index has risen over 16% year-to-date, compared to the NSE Nifty 50's 8.06% rise.

Even as there is consensus on a new capex cycle kicking off, driven by government spending, Sharma does not invest in companies with government exposure. "I am not a big fan of B2G business."

However, he agreed, ideaForge Technology Ltd. has done phenomenally well while doing business with the government.

IdeaForge Technology listed on the bourses at a premium of 94.21%. It is a vertically integrated company that designs and manufactures drones for mapping, security, and surveillance.