In this special edition of ‘Bulls Charge Ahead’, Sunil Singhania, Founder of Abakkus Asset Management, talks about festive cheer on Dalal Street as the market scales at record highs.
Singhania said, “The last 18 months have been phenomenal. We started off with a lot of scares, but I think all is well that ends well. As we speak, there is a lot of optimism within the economy and, also the markets. Having managed public money for such a long period of time, you have learnt the lesson that managing expectations always is very important. So I think what we are taking at this period of time is continue to be optimistic.”
On generating alpha in this market Singhania said, “If you see the markets have been undergoing a transformation. The last four or five years have been a period where only a few stocks and a handful of sectors sort of gave you returns, the rest of the sectors were just being neglected. I think investors have realized that the economy and the markets are not made up of only a few stocks, but also have a lot of other sectors and stocks that can do really, really well. If you actually see the movement of the markets for the last 6-12 months, it has been the neglected sectors, which investors have realized that they keep on churning good profit, they keep on churning good cash flow and they are the stocks and sectors where there is huge undervaluation compared to the market.”
“There are still opportunities to be made, we are looking at Nifty growth for two years which is FY22 and 23 being 50 percent higher than 21 on a cumulative basis. That is a factor of low base for FY21 as also a lot of other sectors performing. Predominantly, I would say the earnings growth will come from metals and economy-related sectors, maybe even banks."
For full interview, watch accompanying video...