In the last blog I mentioned the fact that maybe we had hit the bottom post the Windfall tax news. Post that, NASDAQ is up a thousand points, almost ten percent and nifty is also up over a thousand points, almost 6%. We should realise Nasdaq was down almost 35% while Nifty was down 18 so it’s an almost equivalent rebound.
The GST collection has consistently over 1.4 lakh crore, exports are averaging $40 Billion a month, Indian rupees hasn’t fallen off the cliff even amidst all this flight to the safety of US dollar. Corporate profitability, their balance sheets are in the pink of health and capex journey is all set to begin. Now what it means is that Indian economy is in a much healthier shape than before and the moment markets turn, India will resume its upward journey.
As far as markets are concerned, my belief that we’re in a secular up cycle which suffered its first time correction over the last eight nine months. This has shaken the weak hands and the punters who thought buying shit can make them millions are now out of the system mostly , if not completely. The days of ultra high valuations for anything and everything is over and most of the fancied Saurabh Mukherjee’s names are down in the dust. My best way to find out is that his appearances on the TV have reduced which is an indication of the new reality.
What went up the most has fallen the most. Nobody talks about IRCTC and IEX anymore. So does about Dr Lal, Chemical stocks, India Intermesh types were taken to the cleaners while metals have fallen off the side. ITC is back to the top of the charts while Reliance and TaMo have refused to fall that much.
I’m personally extremely bullish on HDFC AMC and ICICI SECURITIES and luckily Mercellus has exited it as well post their exit in ITC. It is the Jim Cramer of Indian markets. Whatever they sell goes up significantly. ITC was sold and look what it has done. And AMC has begun to crawl back to a more rational level.
The thing about ISEC is that people were worried about the fact that markets will go down and that will reduce its brokerage income and thus it got corrected from 900 to 400. Now the thing is, less than half its income comes from broking. Plus, markets have begun to turn and people will come back all guns blazing and so will brokerage income. Plus, it’s extremely less owned by funds so the moment it turns, there will be a rampage to add it to the portfolio, something like a BSE move last year.
My blogs are getting shorter and that’s because after saying the same thing in 70 blogs, I’m getting the clarity I require.
The only thing you need to do is to bet on India, on stocks which are going to grow faster than India and the ones who can survive the next five years. Rest, it’s all taken care of.
Life is all about Compounding! 