Dont Wait For The Bottom-Dare To Invest Now!

The entire world is reeling under the chaos created by the ongoing trade war between the US and China. However, at the same time, the US markets are doing well. The Dow continues to stay at its highest level. India too could have been at its best had the demonetisation and GST rollout not come in the way. While we subscribe to the government’s intent of getting better practices and processes in place, the slip has been the underestimation of the impact these two rollouts would have. The undercurrent of weakness is dragging the GDP down. The growth is not kicking in to make up for the weakness. Hence, the recovery is getting prolonged, thereby stretching investors’ patience painfully long. However, just as during boom times the markets tend go into overbought mode, we sense the markets presently are getting into an oversold mode. This implies that once these issues get addressed, the market will bounce back with a vengeance. 

Yes, our FM appears to be stingy in terms of rolling out economy boosting measures at the moment, however it might be just a matter of time before aggressive roll-outs happen. The incentive like the FPI surcharge rollback has done little, just the way Hong Kong Leader Carrie Lam’s one concession has done little to address the riots there. 

FII’s continue to pull out money from the Indian markets. It appears their concern is more on whether the current slowdown is cyclical or structural. In order to understand this, we have chosen to do a cover story on the economy so as to give our readers a better insight on where we are and what can be expected in the coming months. 

Our special story this time focuses on a potential class of stocks that will be among the early gainers in a rising market. We have crunched data and ranked the mid-cap companies based on multiple parameters to list them under three categories. First category is of companies that were already in the black and did better, the other category is of companies that were in the red but turned black this year. The third category is of companies that have reduced their losses. 

The year 2019 continues to carry forward the pain and gloom of 2018. The good part is that a large chunk of bad times are behind us and it is only a matter of time when things should start improving. There are plans by the government to reduce returns on PPF and NSC. This will lead to added flow of funds into equity and other asset classes. In addition, there is move to front load the infrastructure spending that is budgeted for next 5 years. We continue to reiterate that investors should not miss on picking up potential stocks now as nobody can time the bottom. 

Stay patient, stay observant of opportunities and dare to invest now.

RAJESH V PADODE
Managing Director & Editor