Ace investor Rakesh Jhunjunwala says that we are on the brink the mother of all bull runs. “In the next 12 to 13 months, we can see the market give at least 15% returns. What we are seeing right now is the start of a bull run. Markets could see a new high during this time”, says Rakesh Jhunjunwala, speaking at Morningstar’s Investment Conference.
The Sensex has risen close to five per cent since mid September and it has even touched a yearly high.
He says that falling commodity prices will benefit India the most. “A lot of foreign money will flow into countries like India. I am still bearish on the Western world. Europe is still a challenge. The Qualitative Easing measure money is yet to help the condition in America. In India there is a fine balance between investment and consumption and also aggressive monetary policy.”
Madhusudan Kela, Chief Investment Strategist at Reliance Capital is of the view that we were already in a bull run. “We were in a 50% bull run. Look at how the prices of FMCG, health care, auto and cement have done. The shares of all these companies have risen despite the rest of the markets nose diving”, he said.
He, however, says that one should not bet blindly on a sector. One should look at interest rate sensitive sectors and economy related sectors. “One such sector is the real estate sector. Their market caps have taken a beating, but if you see their balance sheets are better than what they were back in 2008. These companies have also gone into execution mode.”
Jhunjunwala’s advice for the retail investor to go for companies that are mature and whose earnings are predictable. “Though these companies may give lesser returns, they are low risk. Also do not be greedy while selling, but be greedy while buying. If you have a large holding in a company, do not be greedy when it comes to selling.”
He, too, like Kela, is bullish on the real estate sector. Other sectors to watch out for are media, infrastructure and banking.
