Volatility continued to rule the stock markets amid a near-zero April IIP (index of industrial production) reading, in addition to a probable downgrade by Standard & Poor’s (S&P) on India’s investment rating. Markets rallied in the earlier part of the week, led by rate-sensitives on hopes the Reserve Bank of India (RBI) may cut interest rates to boost growth. However, high May WPI (wholesale price index)inflation at 7.55 per cent, above RBI’s comfort zone, dashed hopes of a dovish stance by the central bank on key policy rates.
Three out of the four fund managers of Smart Portfolios Season 4 remained active between June 6-13.
Rikesh Parikh
Parikh carried out 15 transactions during the period under review. He added large-cap stocks like ICICI Bank and Coal India, along with mid-cap scrips HCL Technologies, Madras Cements and Mcleod Russel India. If the rally continues then midcap space to witness a spillover effect as scrips are available at reasonable valuations.
Meanwhile, he exited from public sector undertakings like State Bank of India, Allahabad Bank and Power Finance Corporation. Pantaloon Retail (India), Infrastructure Development Finance Company, Hindalco Industries and Larsen & Toubro were the other scrips that fell out of favour over the past week. Commenting on the markets, he says Greek elections and RBI policy outcome would decide the further course of the market. He expects at least a 25-basis point cut, with a probable CRR (cash reserve ratio) cut.
| RIKESH PARIKH, VP (equity strategies), Motilal Oswal Securities | |||
| Top holdings | Cost price (Rs) | Current price (Rs) | Value (Rslakh) |
| ICICI Bank | 857.68 | 818.85 | 0.65 |
| Hindalco Industries | 124.15 | 120.25 | 0.48 |
| HCL Technologies | 500.24 | 478.75 | 0.48 |
| Jaiprakash Associates | 75.64 | 67.55 | 0.46 |
| Power Finance Corporation | 166.04 | 161.95 | 0.45 |
| Total investments | 4.18 | ||
| Cash | 5.78 | ||
| Net worth | 9.96 | ||
His current top holdings include ICICI Bank, Allahabad Bank, Hindalco Industries, HCL Technologies and Jaiprakash Associates. His net worth is at Rs 9.96 lakh, down 0.4 per cent.
Ashish Mittal
Mittal carried out six transactions during the week. He accumulated Tata Motors and Unichem Laboratories. He also added Hyderabad Industries, Dhanlaxmi Bank and Engineers India to his portfolio. Commenting on increasing his exposure to mid-cap Pharma stock, Unichem over the past three months, he reiterated his belief that the company had the capability to turn around and achieve significant profit growth in FY13.
According to him, equity markets will remain sound. He is expecting a rally in the second half of the current year. The expected fall in inflationary pressures, reversal in interest rate cycle and continued strength in domestic demand would augur well for corporate profitability, he added. The valuations are also comforting. The only fall out in the above picture would be increased stress from Euro Zone and escalation of debt crisis.
| ASHISH MITTAL, Fund manager (PMS), Centrum Wealth | |||
| Top holdings | Cost price (Rs) | Current price (Rs) | Value (Rslakh) |
| Balmer Lawrie & Company | 618.48 | 559.25 | 0.73 |
| Karur Vysya Bank | 372.59 | 417.10 | 0.71 |
| Tide Water Oil Co (I) | 6988.28 | 6911.20 | 0.70 |
| Unichem Laboratories Ltd | 144.82 | 127.20 | 0.70 |
| Bombay Burmah Trading Corp | 490.42 | 534.65 | 0.67 |
| Total investments | 8.69 | ||
| Cash | 1.29 | ||
| Net worth | 9.98 | ||
His top holdings, include Balmer Lawrie & Company, Karur Vysya Bank, Tide Water Oil Co (I), Unichem Laboratories and Bombay Burmah Trading Corporation. His net worth stands at Rs 9.98 lakh, down 0.2 per cent.
Alex Mathews
Mathews remained inactive during the period under review. His top holdings include MMTC, MRF, Hindalco Industries, Titan Industries and State Bank of India.
Commenting on his inactive status he said he is watching out for the outcome of the Greek elections which could be a game changer. If there is a positive move from RBI — a CRR cut and/or rate cut and the Greek elections are supportive, he sees the Nifty moving above 5,300.
| ALEX MATHEWS, head(technical and derivatives research), Geojit BNP Paribas Financial Services | |||
| Top holdings | Cost price (Rs) | Current price (Rs) | Value (Rslakh) |
| MMTC | 771.42 | 745.80 | 0.41 |
| MRF | 11318.02 | 10380.05 | 0.31 |
| Hindalco Industries | 128.83 | 120.25 | 0.24 |
| Titan Industries | 247.02 | 213.60 | 0.21 |
| State Bank of India | 2208.51 | 2150.25 | 0.21 |
| Total investments | 3.33 | ||
| Cash | 6.25 | ||
| Net worth | 9.59 | ||
His current top holdings include MMTC, MRF, Hindalco Industries, Aptech and State Bank of India. His net worth totals Rs 9.59 lakh, down 4.07 per cent.
Ajay Parmar
Parmar carried out 11 transactions during the week. Expecting a short-term rally in interest-sensitive stocks, he bought L&T, Tata Motors, Bajaj Auto and Hero MotoCorp. His other buys included Essar Oil, Indiabulls Power, Strides Arcolab, Bombay Dyeing & Manufacturing Company, Jindal South West Holdings and IVRCL. According to him, valuations are attractive at current levels but one may not be able to gauge what kind offall could come in.
He expects the markets to be range-bound with any negative data in India and the US leading to rate cuts/QE3 for US while the euro will continue to remain on the centre-stage, pulling down hopes of any significant rally. He believes RBI will now focus on bringing growth back. So a 25-50-bps rate cut is imminent.
| AJAY PARMAR, Co-head (investment banking), Emkay Global | |||
| Top holdings | Cost price (Rs) | Current price (Rs) | Value (Rslakh) |
| Tata Motors | 234.99 | 226.70 | 0.45 |
| Nestle India | 4715.31 | 4541.40 | 0.45 |
| State Bank of India | 2134.07 | 2150.25 | 0.43 |
| ICICI Bank | 894.03 | 818.85 | 0.41 |
| Jindal South West Holdings | 563.66 | 547.30 | 0.41 |
| Total investments | 7.39 | ||
| Cash | 1.97 | ||
| Net worth | 9.36 | ||
His current top holdings are — State Bank of India, ICICI Bank, Tata Motors, Nestle India and Jindal South West Holdings.
His net worth is valued at Rs 9.36 lakh, down 6.3 per cent.
