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    New age tech cos could fall 80-90% in 2022, says Big Bear Shankar Sharma

    market | IST

    New age tech cos could fall 80-90% in 2022, says Big Bear Shankar Sharma

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    In an interview to CNBC-TV18, independent market expert Shankar Sharma said one should not be surprised if new age tech companies fall 80-90 percent by the end of 2022. His comments come on a day shares of the likes of Paytm, Zomato and Nykaa hit 52-week lows.

    New age tech companies—the darlings of fund managers and retail investors alike just a few months back—are bearing the brunt of the selling fury on Dalal Street Monday.
    Shares of Zomato, Paytm, PB Fintech, CarTrade, Nykaa, Fino Payments Bank have all fallen to their lowest levels since listing. Shares of Paytm and CarTrade are now down by more than 50 percent from their issue price, while Zomato, one of the star performers in the pack, is not far from its issue price after a spectacular performance in the first three months after listing.

    EXPLAINED

    Independent market expert Shankar Sharma, known more for his aggressive bearish calls than bullish ones, has cautioned that these shares may still have room to slide further.
    In an interview to CNBC-TV18, Sharma said one should not be surprised if new age tech companies fall 80-90 percent by the end of 2022.
    Sharma is of the view that the market is seeing normalisation of "something that was "extremely frothy". The froth started from the unlisted space, which was really the venture capital-funded companies that permeated to the listed space through listings in the last six months," he said.
    "Almost all of them are completely and totally devoid of any valuation merit. Their business models are commoditised, there is nothing unique about any of the companies that have got these crazy valuations... They have already fallen 20-50 percent, and can fall another 50 percent and still not be cheap," Sharma added. 
    He said the run up in prices had pushed many segments of the market into the overvalued zone.
    At the same time, India as a market is relatively better placed compared to other emerging markets and could remain an outperformer in 2022 as well, Sharma said, adding that India had a solid buffer in the form of domestic liquidity.
    Foreign funds have net sold over Rs 8,000 crore so far in January, but brokers say interest from individual investors, particularly wealthy investors, has been quite strong.
    Monthly inflows into mutual fund schemes by way of systematic investment plans(SIP) is now over Rs 10,000 crore, creating a problem of plenty for fund managers.
    Sharma said there were a number of stocks in the chemical and pharma sectors that were going cheap.
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