See flooring for market between 10,500 and 10,750: Jhunjhunwala

Posted On Aug 26, 2019 By admin With Comments Off

Low interest rate scenario is here to stay. Interest charges worldwide are not going to reverse readily because there is no inflation on the horizon, says Rakesh Jhunjhunwala, Owner, Rare Enterprises. Excerpt from an interview with ETNOW.What do you determine of the FM bulletins on Friday? Do you think there is enough in the bulletin to fix the sensibility and their own economies? There is no one thing which can resurrect affection. Economic activity is a series of things. Well surely it is an expression that the government is concerned and it is going to take all those steps which are necessary to revive the economy. That itself is a very good feeling and the steps which they have taken are good and will help revive the economy. Do you think there is just too much of dejection on the Street? When I say Street, I am not just referring to market, I am referring to inventors, buyers. Everybody is talking about slowdown. But do you think the reality is different from what everybody is narrating? It is very fashionable to talk about the slowdown and how severe it is. But event tells me that it is not highly profitable. I have never seen that pessimism in the market. When we spoke last-place, you said we must remember the practice India did business in the last couple of decades versus how India will do business in the coming decades would change. The change is coming at a cost. When do you think the benefits of the transition will start wondering in economy and likewise at various stages? It is not that they are not reflecting. It is not that the benefits of GST are not manifesting but a series of measures have to be taken and combined together, they will really give a boost. Do you think the government has done the right thing by not comprising on the monetary because the easy thing would have been them to bust the fiscal and start spend? If I were to decide, I would not mind jeopardizing some segment on the fiscal but with the poor tax collections and the ambitious targets, we will have to have some kind of correction in the monetary naturally itself because I do not think tax collections are going to match what the government has estimated. Therefore there is not much space for fiscal mildnes but nevertheless, 25 -3 0 bps is not going to mean much and with inflation under control and the world under craft struggle I would propose some mercy in the fiscal deficit. When do you see the sensibility turning around? See sentiment turning around is not an occasion, it is a process. It will take time and therefore I picture the Street today is negative in spite of what the government has announced. Maybe it is because of the fall in global markets. If parties do not get too excited, then things will stabilise and I feel it is too much for us to expect that the market will bounce back in a big way immediately. Markets are going to go circular. They are going to take time. But the bottoming out process is now starting. But don’t you think that the measures will introduce a floor at least to this falling market? Merely last week we have had a rough patch and on Friday, we rebounded from those lows of ten, 750 thereabouts. Do you sense that a floor could be near at least? I personally feel anything between 10,500, 10,750 is a floor for the market. And you is not envision the previous lows would be tested again? Well they will be tested but I do not think it will be very effectively broken. Last epoch when we spoke you also mentioned to watch out for midcap capitals who the hell is due for a sharpish adjustment. Do you think the pricewise improvement is over in mid and smallcap broths? I do not know whether the adjustment is over or not, but I do experience a lot of opportunity in midcap furnishes and I personally will be broadly a purchaser of midcap capitals at this stage will gain handsomely in time to come.Do you think the pessimism in the stock price is overdone and fundamentals are not that bad? Yes, I thoughts the cynicism is overdone. Given that we are in a very low interest rate regime locally and around the world, what kind of scenario in coming years could we be staring at? The low-pitched interest rate scenario is here to stay. Interest frequencies worldwide are not going to reverse easily because there is no inflation on the horizon. How unruly could the busines war be for the world? It is going to be intrusive for the world but I do not think it is intrusive for India. You are making a case that India will gain because of trade war because India is not a large player? India will not lose because a lot of the manufacturing will alter and also exports are not such a very important part of the Indian economy. Unless and until Americans start targeting assistances, I do not review India will be positively feigned. The biggest silver lining for Indian markets has been the SIP flows. Do you think the SIP flows and domestic financing will pick up further? Ultimately savings have to go somewhere and I think they will find their home in financial markets and within finance markets, a large part in equity. Now with the PSU bank recapitalisation coming in, do you think lending can come back to the system? Lending will have to come back, what will the banks do with the money? But they were resisting? They were repelling but I do not think they will resist. I intend, ultimately they will have to lend. You have always been very buoyant on the banking sector. In a recent interview you also said the peak of the NPA cycle now passed. Is it time to look away from corporate banks and look at PSU banks? That you attain your own preferences. I would not like to comment on it. In words of possibilities, you said there is definitely an opportunity in the broader groceries. I want to get a sense from you.So you study, I do not want to draw remarks about any specific sector or furnishes.