Rakesh Jhunjhunwala, as usual, was the first to spot the opportunity arising from NAMO. He sent his disciples the powerful clarion call “This Will Be The Biggest Mother Of All Bull Markets Of My Lifetime”. The Badshah gave convincing reasons full of strong logic in support of his view.
Motilal Oswal took the cue and urged investors to grab stocks before NAMO starts his magic.
Now, Raamdeo Agrawal has endorsed the same view. In his latest interview, Raamdeo explained that this is an “Once-in-a-lifetime” sort of event, with a major political and economic change.
Raamdeo emphasized that what investors have to see is the risk-reward ratio of making investments now. “The risk is about 10% while the upside is about 100%” the veteran investor said with great confidence in his voice.
“The valuations are still reasonable and this is a terrific time to put your bets in the market without trying to time it” Raamdeo added. He also advised investors to stop obsessing about whether the market would go lower and if they could get the same stocks a few percentage points lower.
“Stop trying to time the market” Raamdeo advised investors in a stern tone, as he reminded them of the risk of missing out on a golden opportunity.
If you want a rational explanation on why there is a boom in the stock market, and how long it will last, you have to read Saurabh Mukherjea’s analysis. Saurabh has analyzed the data of the past 30 years and explained what is presently going on in the markets.
If you are wondering what stocks to buy, you have a wide choice. Apart from the stocks recommended by Saurabh Mukherjea, you can consider the stocks suggested by Basant Maheshwari, HDFC Securities, Dolat Capital & Daljeet Kohli. You cannot go wrong with these stellar stock picks.
There is nothing that can now go wrong. Everyone’s optimistic and cheerful. This stock market has already risen a lot, and will continue to rise till foreseeable future. Politics is conducive to growth. Businessmen exude confidence. Investors exude even more confidence. Brokerage houses of course are overboard. The index can touch 28K. 30K. 40K. Even 100K as per one brokerage house.
All of above is precisely when one must not lose one’s head!
While I agree in general with the experts, one must keep in mind that most of the triggers for the market are from an Indian perspective. This is the first time in the history of India that such a government (read – nationalistic to the core) has got a clear mandate and of course the Indian markets are celebrating. But here are a few points –
1. As the Indian Rupee gathers strength, people who were making money providing cheap labour and exporting it instead of building a business that was not dependent on a cheap Rupee will lose. Infosys is the prime example.
2. The companies that are into solely exporting minerals from India to overseas and this is their business model, are going to be losers. Sesa Goa used to be one such company, it exported raw iron ore to Japan and India used to import finished steel products at a much higher price despite having a robust domestic iron processing industry. Needless to say, allegations of bribes per ton of raw iron ore were floating around for years.
3. The economy of the EU is in extremely poor shape and the Euro is propped up artificially. The day that it comes undone is going to be a crash in the Indian markets as well.
4. The Chinese economy is like a puffed up toad, it does not have inherent strength, and pretty soon it will deflate as well. One must keep in mind that China does not have free markets like the most of world. The crash of copper yesterday was just another signal. One can take a trip to the ghost cities of China to figure out it’s wealth.