Raamdeo Agrawal of Motilal Oswal Securities believes that the market is fairly valued at the moment. He does not expect any slowdown in corporate earnings for FY06-07.
Life Insurance Corporation of India (LIC) has made the most of the stock market boom by reducing stakes in all its top conglomerates during the financial year 2023-2024 (FY24). However, even after reducing exposure, the value of its remaining stake has gone up substantially across all groups, according to data collated from stock exchange filings.
Raamdeo Agarwal of Motilal Oswal Securities believes that the current market valuations are fair. He feels that the market is still buoyant and the sentiment will remain positive.
Midcaps to remain at a significant discount to large caps
Raamdeo Agrawal of Motilal Oswal Securities believes that the scope for surprises in the market in 2007 is limited; he expects 17-18% returns. Moreover, he says that there is no major concern at Sensex valuation of 17-18x.
Fall in crude prices has eased interest rate worries and that expectation of good Q2 is already factored in the prices.
Shares list at 21% premium over offer price of Rs 825.
Motilal Oswal and Raamdeo Agrawal, the promoters of leading brokerage house Motilal Oswal Financial Services, will be worth Rs 700-800 crore (Rs 7-8 billion) each, after the company's initial public offer later this month.
'Like all long-term bull markets, the Indian stock market will continue to climb the proverbial wall of worry.'
Raamdeo's base argument is that India's stock market merely mirrors the national economy, which is poised for big things.
'Valuations were depressed at 8,000 (Nifty 50 index) levels. It was a free ride to 12,000 levels.' 'What went down had to come up. Now fundamentals have to support further gains.'
Oil-to-telecom conglomerate Reliance Industries (RIL) has emerged as the country's largest wealth creator, adding a staggering Rs 9.6 trillion over the past five years, according to Motilal Oswal's 26th Annual Wealth Creation Study. In doing so, the Mukesh Ambani-led company has beaten its own record of Rs 5.6 trillion generated in 2014-19. The study covered financial year 2015-16 (FY16) to FY21 and ranks the top 100 companies in descending order of absolute wealth created, subject to the company's stock price outperforming the BSE Sensex. The firms were also ranked according to speed (price CAGR during the period).
'The IPO market is cooling off and getting a reality check.'
'Indians are great savers, but they are lousy investors.'
At the 45th Annual General Meeting of Reliance Industries (RIL) in August, chairman and managing director (CMD) Mukesh Ambani described the company as an "unputdownable book" with never-ending chapters of success. "Reliance grew from strength to strength because we internalised the founder's mindset of purpose, philosophy and passion," he said. Wednesday marked the 90th birth anniversary of RIL founder Dhirubhai Ambani.
Experts say a turnaround may happen after the general elections.
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'The market recovery is fragile,' warns Raamdeo Agrawal, co-founder and joint managing director, Motilal Oswal Financial Services.
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'It is almost four years since we've seen strong growth in earnings.' 'The markets have rallied about 20 per cent in the past year, which is ahead of earnings.' 'So, the stress now will be on earnings to catch up.'
Eight Sensex biggies such as Reliance, L&T, BHEL, SBI and ICICI Bank are among the worst hit.
Experts believe volatility is here to stay for some time, at least till China stabilises and clarity regarding the US Fed's interest rate move emerges.
'Four times in Indian history, in 1992, 2000, 2007 and now, markets are at 25 times price-earnings.'
Sharp swings likely in equity, forex and bond markets.
Bull run in the markets is likely to continue for next 5 years, says Motilal Oswal MD.
It won't be an easy ride for the markets, reckon experts, considering the multiple state elections in 2018 and general elections next year.
But experts say downside limited, pockets of opportunities for investors
Raamdeo Agrawal says, an investor should figure out if the company actually makes money or not, making an investment comes later.
Over the past two decades, India has evolved economically as well as from the market's perspective.
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