The Indian stock markets are soaring like there is no tomorrow. Starting at 13,000 in the beginning of this year, the Sensex crossed 20,000 by October.
Will the Sensex sustain the gains or will it go down again?
Where is the stock market going? Will it rise further? Or will they crash again? What should a small investor do in such a scenario? Should he hold on to his stocks or sell them? Should he buy stocks now or stay away from the market?
Market expert Pranav Sanghavi answered many such readers' queries in an hour-long chat on Wednesday. Here is the transcript:
PRANAV SANGAHVI says, Good afternon and welcome to the chat. Let's begin.
karan asked, Good afternoon Pranav, what should be the strategy for next two months if one wants to buy some quality stocks.which sectors/stocks should one look for with a short term(say about 6-9 months) and with a long term(a few years) time frame in mind.
PRANAV SANGAHVI answers, at 2007-11-28 11:59:42Hi Karan, I would go with the cement, power, banking ad infrastructure stocks. You could look at stocks like DLF, GMR, SBI, NTPC, Pwer Grid, Guj Amb, Grasim etc.
ps asked, I got 15 Mundra port at IPO price. Should I hold or sell ?
PRANAV SANGAHVI answers, At current status the stock is fairly valued but on a longer term basis I think the stock has potential to go up further. If you have some other investment in mind then probably you could book profits and look at some other sector.
ps asked, Can I subscribe to Jyoti Labs IPO ?
PRANAV SANGAHVI answers, They are a decent mid sized pharma player wiht a few popular brands in the market. they also have some expansion plans post the IPO so you could surely look at it.
Bharat asked, Hi Pranav, I have bought RPL 200 shares at Rs.275/-. Please advise me how to go about this particular stock.?
PRANAV SANGAHVI answers, Hi Bharat, unfortunately you have got in to the stock at very close to its highs. You may not see your price in the very short term but if you can hold on then you will surely see profits beyond 6 months.
kumar asked, hi good morning sir, Can i invest in essar oil.. if so what is max. price at which i should buy?
PRANAV SANGAHVI answers, Good afternoon Kumar. Essar Oil has most things going for it. The Promoters are putting in money at close to market levels and not a discounted rate. The Oil refenery segment in our markets is getting rerated. I think you could surely hold on to the stock with a long term view. But the gestation period is also a bit longer than RPL.
ps asked, What are your views on Core Projects and Technologies? Can I accumulate for long term ?
PRANAV SANGAHVI answers, I don't follow that stock so I won't be able to help you sorry.
abhay asked, Iwant to invest in long term for atime period of 6 months to 1 year and some investment for 3 Years . Please suggest the stocks whic can give good returns. How about the Auto market such as Asoka Lyland for long term invest ment. Regards abhay
PRANAV SANGAHVI answers, You could surely go with the frontline stocks like SBI, RIL, L&T etc if you have a 1 to 3 yewar outlook. They will be the best performers. The Auto segment is facing a higher interest rate scenario currently but eventually when the interest rates do come down a bit the auto segment should outperform as there is good potential for growth in the sector.
karan asked, please name one company each from the following sectors(please add/delete sectors if you wish to do so) that you would like to watch/look for in the coming months: banking, infrastructure, cap goods, power, IT/Software, engineering/tech, pharma, telecom, etc
PRANAV SANGAHVI answers, From the sectors you have mentioned Iw ould look at SBI, HDFC< ICICI, DLF, Unitech, Gmr, Indiabull Realty, L&T, BHEL, NTC, REL, Infosys, TCS, Wipro etc.
ps asked, Can I enter RIL and REL at current levels ? Am a long term investor.
PRANAV SANGAHVI answers, From the highs of the market it has corrected marginally already. But I would still wiat for a minor correction before I jump in to the frontline stocks. As a long term investor you could surely pick up the stocks in parts on evr dip.
kumar asked, i had purchased DSQ software 300 nos. 2 years back @ appx. Rs. 50/-. Will the company be listed again?
PRANAV SANGAHVI answers, It has serious SEBI irregularities and has been penalised. Even the promoters have faced a lot of problems due to their un ethical dealings in the markets. I doubt it seriously.
ps asked, What would be a good level to enter SBI ?
PRANAV SANGAHVI answers, Keeping the rights issue in mind you could enter even at current levels to get the rights benefit. If you are holding on to the stock witha long term perspective.
kaps asked, is buying infosys in this 52 week low a good decision.
PRANAV SANGHAVI answers, I think Infy will continue its 20% plus growth in dollar terms atleast. It may still face the problem of a weaker dollar in the coming year too. But with a longer term view you could look at it. Although Infy did look attractive at 1750 and it went down to 1500 levels.
ps asked, Can I enter Tata Steel at current levels ? How much appreciation is likely in a year ?
PRANAV SANGHAVI answers, I would surely look at Tata Steel witha longer term outlook. In a years time you could easikly see a 20 to 30% return from current levels. As the profits of Corus get built in and its debt is reduced the profitability of the company will rise substantially.
b asked, Will the Sensex sustain the gains or will it go down again? Where is the stock market going? Will it rise further? Or will they crash again? What should a small investor do in such a scenario? Should he hold on to his stocks or sell them? Should he buy stocks now or stay away from the market? Did you make profits while the Sensex scaled dizzying heights? How do you plan to consolidate your gains? What should your investment strategy be now? Should you invest more in the market? Should you consider selling a few stocks? What would be the best stocks to buy, sell or hold at this juncture?
PRANAV SANGHAVI answers, Every meteoric rise has to be followed by a correction. The markets could correct marginally further backed by either news from global markets or some local factors. But overall on a longer term our markets still remain in a bull phase atleast for the next 2-3 years. Correctiosn should be used as an opportunity to get into quality growth stocks.
ps asked, What are your views on ABN Offshore ? Can I enter at these levels for long term play ?
PRANAV SANGHAVI answers, Well it is a large player in the offshore drilling business. You could surely look at it with long term outlook.
kumar asked, i purchased OBC (Rs.240), UCO (Rs. 61), Ispat (Rs. 39 & 48), Souther Ispat (Rs. Rs.16.60) and MRPL (Rs. 87.20). Kindly advise on holding/selling. Thanks
PRANAV SANGHAVI answers, OBC, UCO and MRPL could be held from the pack you mention. The others you could sell and book profits unless the company comes out with positive news.
kumar asked, Will Welspun India will surge further? What is the maximum it is expected to go?
PRANAV SANGHAVI answers, Wellspun has had a good run over the past year. Now it should grow in tandem with its results and news flow.
VVR asked, Dear Pranay, Good Afternoon, Your advice on Telecom Sector Idea @ 110 RCOM @ 550. Holding these for 5 years is a good bet or booking part profits regularly is ok pls advice
PRANAV SANGHAVI answers, Good
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