Indian stock markets are soaring like there is no tomorrow, and currently hovering at 20,600 levels. What do you think will the stock markets hold for you in 2008?
Where is the stock market going? Will it rise further? Or will they crash? 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?
In an hour-long chat on
rediff.com on Friday,
market expert Pranav Sanghavi responded to many such readers' queries. Here is the transcript:
PRANAV SANGHAVI says, Good afternoon everyone. Hello and welcome to the chat. Let's begin.
ytdt asked, Hi Pranav, do you think there would be a small correction before the rally related to third quarter results?
PRANAV SANGHAVI answers, at 2008-01-04 12:01:17I think we witnessed that correction when the markets tested the 19,000 level a week ten days back. I think now the next correction should come post a rally and before the budget. Unless ofcourse there is some adverse news with a heavy influence on our markets simultaneously with the results season.
ytdt asked, what should be the strategy now? i have some money which i want to put in tax saving mutual funds and some select shares... when do i do that?
PRANAV SANGHAVI answers, If you are not invested already, you could pick stocks who you think should deliver spectacular results but have not started moving up yet or moving sideways for some time. If you want to invest heavily then wait for the correction.
karan asked, Good Afternoon Pranav, what is your outlook about the markets for this month, some of the large caps like RIL, L&T ,SBI,BHEL etc have not risen significantly in past two months. do you see a buying opportunity here?
PRANAV SANGHAVI answers, I see tremendous buying opportunity in these these stocks. SBI for example has paid an advance tax of around 1000 crores for the last qtr, as compared to 600 crores and 800 crores for th eprevious two quarters. RIL has paid an advance tax of 1000 odd crores as compared to 440 odd crores in the previous quarter. So these companies have paid substantially higher advance tax which should result in spectacular profits.
karan asked, what is your take on reliance power ipo
PRANAV SANGHAVI answers, Even though is a huge IPO of over US$ 2.5 billion, I would still subscribe to it. India is a power hungry growing country and Rel Power only looks to bridge the gap. There is also tremendous interest from foreign investors in this sector and especially this stock.
Anand asked, What is your take on idea,i bought it at 149
PRANAV SANGHAVI answers, A couple of months back I had recommended a buy saying that not being a leader it will still follow close in the heels of its larger peers like RComm and Bharti and its doing that. I think it will slowly and steadily move up. Also some beneficial news could rerate the stock. I don't think the governmental policies will make a very deep impact on the company.
nikhil asked, WHAT IS YOUR IDEA ON THE PRICING OF RPL AND RNRL AFTER 3 YEARS.
PRANAV SANGHAVI answers, RNRL I'm still not sure of the business model. But RPL could easily double in three years from now. Idea also should move up steadily with handsome returns post three years.
GB asked, Hi Pranav, Which are the best stocks now to take considering long term profit with nearly 50K to invest?
PRANAV SANGHAVI answers, I would look at L&T, DLF, SBI, RIL, IDFC etc.
SARATHY asked, I HOLD SBI 10 SHARES PURCHASED @ 2300/- Kindly how long should i hold? when the rights issue likely to come and what will be price?
PRANAV SANGHAVI answers, I would surely hold on. Also wait for the rights issue and do subscribe to it. You shall surely benefit from the same. I expect SBI to post stellar results too.
Pranavsfan asked, Hi Pranav, I have RNRL, Ispat Industries, GV Films, Teledata. Can I continue to hold?
PRANAV SANGHAVI answers, I would book profits in Ispat and GV Films. You could look at SAIL instead of Ispat. The other two you could continue to hold on. Also RNRL's major push should come post the result of its ongoing battle with RIL over the gas reserves and its deployment.
sen asked, Hello.. Wish u a happy new year.. What do u feel about the intra day trading.. Do u feel it is more risky than the normal..
PRANAV SANGHAVI answers, Day trading is definately risky if you are not completely learned about the markets. It could have disastrous results. Investing and holding is always a better method.
sidk asked, Hi PRanav, Can I buy Crompton Greaves at Rs 400. Pls let me know. Thanks!!
PRANAV SANGHAVI answers, Yes you could still look at Crompton. There is some real estate related news on top of its engineering business.
Anand asked, Can i get into Tata Steel at CMP
PRANAV SANGHAVI answers, I think it is still a good buy with a 2-3 year outlook. By then the TATA group will have managed to substantially reduce their Corus acquisition debt burden and plus the Corus numbers will start reflecting on Tata Steels Balance sheet which will augment its profitability.
cinki asked, Hi. I am 30 yrs old. My take home is approx. 100k p.m., expenses around 30k p.m., 36k p.m. SIP (Rs.4k each in FIDELITY EQUITY FUND GROWTH HDFC PRUDENCE FUND GROWTH OPT. DSP ML TIGER FUND GROWTH OPTION HDFC TOP 200 FUND - GROWTH OPT. SBI MAGNUM GLOBAL FUND - GROWTH ICICI SERVICES INDUSTRIES GROWTH RELIANCE GROWTH FUND - GROWTH PLAN PRU. ICICI EMERGING STAR FUND - GROWTH FRANKLIN INDIA OPPORTUNITIES FUND - GROWTH), FD worth 6 lacs, real estate investment worth 80 lacs in today's market, one retirement plan from Icici pru with annual premium of 35k and one child's policy with annual premium of 26k. Also approx 11 lacs (cost price) investment in Equity. Pls tell me of the above funds which ones i needn't have in my portfolio. I have 2 yrs old daughter. I would want to retire in another 15 years from now by when i want to accumulate atleast 1 crore after inflations for my daughter and also have a monthly income of 1lac after inflation for myself. How can i achieve this?
PRANAV SANGHAVI answers, Please send me an email for me to reply to this lengthy query. Thank you.
Gaurav asked, Top 3 stocks for 2008
PRANAV SANGHAVI answers, L&T, SBI & DLF.
balaji asked, can i purchase SVC Superchem and KRISHNA Life at present price. Both are BUYERS ONLY today. On your advise, i can go our purchase in thousands so as to get some decent returns.
PRANAV SANGHAVI answers, I don't follow either of the stocks but you should be carefull when B2 stocks hit buyer circuits it is not always market driven.
Gaurav asked, 1 year outlook for ICICI bank. Is it a good buy at 1200
PRANAV SANGHAVI answers, Yes definately.
Ani asked, I have bought 200 shares for PBA infrastructure at 171.75 Rs each. How good ist this share and are there any predictions as per the target?
PRANAV SANGHAVI answers, I don't follow that stock so will not be able to help you.
cinki asked, What are your views on Micro technologies and Hindustan Zinc. Can they be long term horses..if so, what kind of targets can one expect from 2 to 3 yrs perspective.
PRANAV SANGHAVI answers, Hind Zinc is a metal commodity stock and commodities by nater are cyclical. Although HZ has a strong balance sheet and good workings. You could look at it with a long term outlook.
kumar asked, i hold IFCI 100 shares purchased @ Rs. 108/- Recently there was selling presssure due to some report and went below to Rs. 70 and it is recovering now. How long should i hold to get some returns? Whether it will reach my purchase rate?
PRANAV SANGHAVI answers, You have bought in very close to its all time highs. You will have to hold on for a very long time as the disinvestment process failed the first time and for the whole process to start again and find genuine investors without management stake could take time.
ni3 asked, hi, what is the future of Burnpur Cement and bgr energy ?
PRANAV SANGHAVI answers, Burnpur Cem has had a phenominal run yesterday but the scary part is that 95% was traded volume and only 5% turnover of over 150 million shares resulted in deliveries. There looks to be something fishy there. I would stay away.
ganesh asked, Sir Can I buy ITC and Ambuja cement at this level for longterm
PRANAV SANGHAVI answers, Yes you could look at both. Even though FMCg is not in favor their hotel thrust could propel the stock. And Even though people feel there will be a glut of cement once fresh capacities start production, I personally feel that the demand will have risen substantially by then to take in all the fresh production capacities.
Nagesh asked, Hi Pranav , I work in Singapore ..i want to invest in Endowment plans of LIC i can pay a premium of 50000 per year .please advise which policy should i take ...
PRANAV SANGHAVI answers, I am not a certified Insurance advisor so cannot give you advice. But email me your details and I could surely put you in touch with a top 10 all India LIC advisor who could help you.
Nisha asked, Can you tell me about this scripts Indotech Transformer,Gujarat NRE Coke,Man Industries
PRANAV SANGHAVI answers, Indotech transformer is still undervalued if you just go by peer group valuations and PE multiples. It has scope for giving 30-40 % returns in the medium to long term. Guj NRE coke should perform well as coal demand does not look to bow down plus they are making foray in to power production themselves and will have coal available inhouse.
Kannan asked, BEST WISHES FOR A HAPPY NEW YEAR 2008. IT IS A FACT THAT I TREMENDOUSLY
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