Kunj Bansal, CIO – Karvy Capital
For any long-term investor, he should remain invested. Investors’ should look to invest more at any correction. Record high is just a continuation of journey and not an end goal, Kunj Bansal, CIO – Karvy Capital, said in an interview with Moneycontrol’s Kshitij Anand.
Q: What is your call on markets post record highs? What is the ideal strategy — book profits or stay put?
A: For any long-term investor, he should remain invested. Investors’ should look to invest more at any correction. Record high is just a continuation of the journey and not an end goal.
Q: Most of the sectors that underperformed from Feb 16 were banks, realty, and autos. Do you see them rebounding as we enter the next leg of the rally and why?
A: Auto should rebound in the hope of unlocking and repeat pent-up demand as was seen last year. This is likely to be followed by banks though the market might want to wait for clarity on asset quality.
Realty will probably be the last one to recover as such high ticket discretionary demand will be the last one to recover.
Q: How was your journey as Mcap hits $ 3 trn? Any personal experience which you would likely to share when you entered markets and started trading?
A: It has been a learning-filled journey for me. Of course, it has been a great humbling experience. The good thing about investing is that one learns a lot.
We don’t only learn about things in our industry, we learn about a lot of other businesses and their interlinkages, not to mention the global interlinkages.
Q: How did you fall in love with D-Street? Your first trades and subsequent lessons?
A: The sharp market rise during the early nineties generated my interest in the stock market, from then, there has been no looking back.
And, there have been many lessons on the way. The biggest lesson being that the day you feel you have broken the market code, the market makes you realise otherwise.
Q: Mcap up $ 3 trn – when do you foresee 4 trn for Indian bourses?
A: Always difficult to predict timelines. The feeling I get is that the time taken to cover an incremental $ 1 tn from here will be much lesser compared to the time taken in the past.
Q: In terms of valuations — Nifty 12M fwd P/E at 10 percent premium to the long-term average. Do it suggest caution or do you think with earnings likely to play catch up these valuations could stay?
A: Higher end of valuation should always be looked at with caution. However, in addition to being a function of earnings, valuation is also a function of money inflow.
Given the reduced return in other asset classes and other global markets, inflow into Indian equities might keep the valuation at the upper end.
Q: Small & Midcaps seems to be hogging the limelight – what should be the strategy?
A: Strategy should be to take exposure in ‘minority shareholder friendly promoters’, ethical managements and strong business models.
Have a longer time horizon in mind, and if it works out in a shorter time horizon, consider yourself lucky but don’t make that your expectation benchmark.
Q: Any top stocks which investors can buy as the market inch towards life highs?’
A: In the current environment, Auto, Insurance and public sector stocks are offering good investment opportunities
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