Nilesh Shah On How To Pick Stocks In A Market Rout
Envision Capital Services Pvt. Ltd. is looking for opportunities to plough the cash it's holding in most of its portfolios into equities amid the coronavirus-fuelled selloff in the Indian stock markets.
“One would want to make the most of this kind of a steep correction which has set in. That's what we're trying to do now,” Nilesh Shah, managing director at the investment management firm, told BloombergQuint in an interview.
The money manager has started deploying money, he said, but still in very small amounts. “It's most prudent to ‘refine the shopping list' at this time, especially since we're yet to witness the impact of the coronavirus-led slowdown on earnings and fundamentals.”
Indian equities have tumbled more than 30 percent from their peaks in January as the Covid-19 pandemic threatens to stall the economic growth. This comes even as Asia's third-largest economy is set to grow at its slowest pace in a decade.
Shah said he was “constructive” on the technology space and financials. Consumer staples, on the other hand, is expected to witness selling due to high valuations.
Also Read: Manish Chokhani's Advice For Investors On What They Can Do Amid Turmoil
Key Takeaways From The Conversation
- Margin calls and stop losses are getting triggered in the market
- ETFs and passive money is getting liquidated
- Valuations have become a lot more attractive post selloff
- A few months down the line, we'll be significantly better off
- Possible stimulus, peaking out of coronavirus could trigger buying
- Be more focused on long-term value, structural fundamentals
- Large caps in consumer, two-wheeler and utility sectors looking attractive
- The incremental money we put to work will be in large and mega caps
- Continue to have high conviction in mid and small caps we hold
- Constructive on the technology space and financials
- Consumer staples may witness selling due to high valuations
- Telecom sector still has a lot of challenges in the long term
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