The Indian rupee is expected to sustain at 75 against the US dollar, said Mehrab Irani of Tata Investment Corp, adding that it would be a fair value for the domestic currency.
“If you see rupee was already overvalued, when it was 68-69 per dollar few months back it was overvalued, so currently it is coming within fair zone. So, 75 will not be totally ruled out. I think it will be a fair value for the rupee,” Irani said.
He further added, “Today if you see macro scenario is worsened a lot. Current account deficit is almost 2.50 percentage with fiscal deficit 3.3, combined deficit almost 5.8 percent and rupee knocking on the door of 73, while 10-Year G-sec is almost close to 8.25 percentage. So, when interest rates are rising, macro scenario is not good and global markets are not good, it is difficult to justify such kind of high valuations."
Talking about midcaps, he said, “Midcaps have underperformed in last few months or one year, but if you see over five year period they have outperformed a lot, almost 90 percent they have outperformed the Nifty. The valuation of the midcap is 24 times while Nifty is 20 times, almost 20 percent premium even today.”Disclaimer
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