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Investors should avoid the trap of investing in expensive large-cap names: Kotak Mahindra AMC's Nilesh Shah

Updated : November 01, 2019 06:31 AM IST

After the BSE Sensex galloped to its fresh lifetime high in intra-day trade on Thursday, Kotak Mahindra Asset Management Company said that investors should avoid the trap of investing in expensive large-cap names.

In an interview to CNBC-TV18, Nilesh Shah, managing director, said, "On one side, large-cap indices led by the select number of stocks are at the all-time high level and there is undoubtedly some amount of pain in small-caps and mid-caps."

“SIP flows, which have remained so solid over the last 18 months of ups and downs, the numbers which were looking subdued and lower single digit, suddenly with this rally has started looking higher single digit. This kind of rally does give confidence to SIP investors and that is definitely a good feeling,” he added.

Speaking about the drivers of the rally, he said, “I think there are two positives which the market kind of had ignored. One is oil prices remained subdued and second is monsoon was reasonably above average. The other thing is related to steps taken by the regulator and government in order to revive the economy, whether it is related to liquidity infusion in the banking system, whether it is related to interest rate cut or a big bang reform like a corporate tax rate cut. Put all these things together, the market has got the confidence to go long. We have seen select stocks recovering.”
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