Synopsis
Madhusudan Kela highlights the opportunities in Indian stock investments amid market volatility. He emphasizes a selective approach in stock picking and suggests that while large-cap stocks may offer better value, investors should remain cautious about their return expectations.Key Takeaways
- Market volatility creates investment opportunities.
- Investors should adopt a bottom-up approach for stock selection.
- Be cautious with return expectations this year.
- Focus on large-cap stocks for better value.
- Market fluctuations allow for strategic entry points.
New Delhi, Feb 3 (NationPress) Indian stocks present numerous opportunities for investors as market instability can yield favorable entry points, according to a prominent market analyst on Monday.
However, he advised that investors should be selective when choosing stocks, as the current environment necessitates a bottom-up strategy for pinpointing robust stocks.
During a media session, Kela conveyed his positive outlook on investment prospects amidst market swings. Furthermore, he warned against anticipating the same high returns experienced in recent years.
Following the Union Budget presentation and in light of US President Donald Trump’s impending trade tariffs, the Sensex saw a decline of 327.25 points or 0.42 percent, trading at 77,178 during intra-day.
In a similar trend, the NSE Nifty dropped by 138.05 points or 0.59 percent to settle at 23,344.1.
Notably, sectors such as metals, mid and small-cap IT & telecom, and real estate recorded the most significant losses.
The Nifty 50 index has fallen by 11 percent from its peak in late September, influenced by various factors including apprehensions regarding Donald Trump's trade strategies.
Kela, who emphasizes risk-reward analysis, currently sees greater value in large-cap stocks.
The Nifty index is now trading at 18 times its projected earnings for the upcoming year, consistent with its long-term average.
“This year, I am focusing more on large-cap stocks,” he stated, highlighting that consumer stocks, particularly regional brands in the staples sector, are increasing their market share relative to larger firms.
Reflecting on public sector undertakings (PSUs), Kela mentioned his favorable view of PSU stocks three years ago due to their appealing valuations.
While some PSU banks still hold investment potential, he advised investors to maintain realistic expectations regarding returns.
“Exercise caution with your gains from previous years and select stocks judiciously. Market volatility will provide chances to enter at optimal prices,” he added.
