Dimension Corporate Finance Services' advise to retail investors is to book some profits, following the lead of institutional investors. If they don't do so, they are likely to regret it later, Managing Director Ajay Srivastava said. He added the firm was not making any new purchases at the moment.
Indian markets are trading at levels similar to those seen when news of the Israel-Iran conflict broke, which is a sign of resilience. Despite global markets being in a disarray, India's valuations have held steady, Srivastava said in an interview with NDTV Profit.
The NSE Nifty 50 ended 0.68% down at 24,718.6, and the BSE Sensex ended 0.7% lower at 81,118.6 on Friday, when Israel launched an air strike in strategic locations of Iran.
As of 12:32 p.m. on Wednesday, Nifty 50 was trading 0.26% down at 24,789.85, and the Sensex was trading 0.30% lower at 81,345.18.
India has developed a third pocket of investors, which comprises portfolio managers and alternative investment funds. While traders monitor foreign institutional investors, and mutual funds, this third pocket of investors is supporting markets when FIIs and domestic institutional investors are not buying, he said.
Demand for equities is going up and it will go up further as the Reserve Bank of India has adopted an expansive economic policy, Srivastava added.
Dimensions Corporate Finance Service Managing Director Ajay Srivastava was speaking to NDTV Profit Executive Editor Niraj Shah.
In the next one-two years, a substantial amount of allocations will go to metals. Also, a large amount of capital will get invested in precious metal.
Ferrous and non-ferrous commodities are not moving in a hurry, though favoured sectors like cement and steel stocks are positioned to give good returns. Many infrastructure stocks have already rallied, Srivastava said.
He cautioned these stocks would suffer as the government would not be spending more on infrastructure. Investors should stay cautious about the movement of railway stocks, and consumer stocks as these spaces bloom once in two-three years, and wither, he said.
There is fire for growth in consumer stocks if investors believe in the growth story. However, the retail space is changing with a switch in consumer preference to online spaces.
Growth happens in spurts and bursts. The economy is growing at an average rate of 6.5% CAGR, so for consumer companies to grow above that growth rate, they have to invest a significant amount of money into expansion, he said.
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