Nifty near 18K: Shakti Pumps, GR Infraprojects & CDSL among top investment ideas: Mohit Nigam

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The Nifty is looking to inch closer towards 18,200 followed by 20,000 gradually and Sensex might touch levels of about 62,000. But, in the near-term, volatility will be seen in the markets, Mohit Nigam, Head – PMS, Hem Securities – said in an interview with Zeebiz’s Kshitij Anand. Edited excerpts:  

Q) A historic week for Indian markets as Sensex breached 60,000 on the upside while the Nifty50 inched closer towards 18000. What led to the price action despite hawkish Fed and Evergrade worries?

A) Indian Markets achieved another milestone over the week with Sensex breaching the much talked about 60K levels while Nifty50 came closer towards 18,000 on the back of a rally in Realty & IT stocks.

The markets continued the positive momentum as worries around the third COVID wave subsides with the number of cases are reducing every day worldwide. The opening up of the economy also supported the sentiment.
 

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Hawkish commentary by the US Fed has suggested the beginning of tapering, pulling back the stimulus provided to the economy due to COVID implications. The US Fed also suggested that future rate hikes are in offing, but these hikes may come at least a year down the line.

Evergrade issue which impacted the markets worldwide on Monday worried investors’ a bit of another real estate crisis, but the pain subsided as the debt payment seemed to be a regional issue.

Beijing might come to its rescue by taking the necessary steps to limit the damage by providing the necessary liquidity push.

Q) What is your view on markets – any immediate targets for Sensex & Nifty?

A) The markets seem to continue the momentum seen in the past couple of months over the short to medium term till Diwali. The markets are not sensing any immediate reason for a significant correction and will continue to post positive returns.

The Nifty is looking to inch closer towards 18,200 followed by 20,000 gradually and Sensex might touch levels of about 62,000. But, in the near term, volatility will be seen in the markets.

Q) Realty sector topped the charts in the week gone by. What is fuelling the rally and are there any top stocks that investors can look at?

A) The real estate stocks rallied over the past week to the tune of about 20% on the index levels. The factors acting in favor of the real estate investments are a decrease in the stamp duties in the bigger states of Maharashtra and Karnataka.

Also, the interest rates in the economy are getting lowered that has made easy availability of funds for real estate purchases.

IT sector benefited from COVID due to increasing digitalisation of the businesses and in turn, has hired extensively with stronger wage hikes acted positively for the real estate sector.

The work-from-home (WFH) culture due to the COVID-19 implications has made investments in better housing options the need of the many metro cities residents.

Prestige Estates is our top pick due to its less debt nature and strong presence in the major cities of India.

Q) As we approach the expiry week what are your expectations from October series?

A) The October series will continue to see positive momentum, but we expect to remain on a slight flattish trajectory. The October series might see a rally in the IT sector along with the auto sector on the back of the positive result expectations for the Q2 FY22.

The markets might throw us some positive surprises over the next couple of years as companies are presenting improved earnings.

Also, Q3 has always remained a festive season. It will boost earnings as the economy is completely open during the festive quarter and present continued positive earnings momentum.

Q) What should be investors’ strategy as Sensex trades around 60,000 and Nifty50 at 18000? Time to be cautious or ride the momentum?

A) The time is to ride the momentum with caution as markets have rallied over the past year or so. The current levels of 60K on the S&P BSE Sensex and 18,000 on the Nifty50 call for further upside with participation from selected sectors.

Despite the rise in the prices of some of the stocks in the past, further steam is seen in the stocks due to improving financials, these stocks are to be held over the long term to capture the completer growth.

The market has continuously become news-driven and to better track the portfolios and generate returns get associated with the fund managers.

Q) The momentum remains strong – where should investors put money as Sensex trade at 60K and Nifty50 at 18000? Please suggest 2-3 stocks either based on technical or fundamentals?

A) Here is a list of top investment ideas —

Shakti Pumps:

The leading brand in the solar pumps and major beneficiary of the PM-KUSUM scheme of installing thirty-seven and a half lacs solar pumps over the country in the coming years. Also, the company is expanding in other states in which it has a negligible presence.

CDSL:

The company has a strong presence in the APAC region and has established a presence in GIFT city. Continuously, increasing IPO’s and higher participation in the equity markets are proving beneficial for the company.

GR Infraprojects:

The company has strong experience in the design and construction of various roads and highways across 15 states and diversified into railways. The Company stands at low debt.

Disclaimer: The views/suggestions/advices expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.