6 DALAL STREET INVESTMENT JOURNAL I JULY 22 - AUG 4, 2019 DSIJ. in^
Lack Of Trigger To Test
Investors Patience
A
fter falling by more than 1,000 points post-budget, Sensex is showing signs of recovery.
Recovery is visible right now, whether it will be sustained depends a lot on the earnings
season. What is bothering the market is not that there were no great positive triggers
for the markets in the budget, but the fact that not much was done on the liquidity front. Bank
recapitalisation announced in the budget, while considered a must to boost liquidity in the
system, is not seen as a good enough solution for the liquidity issues. The market expects more
solutions from the government. The business sentiment is weak right now as it is in other
emerging economies.The slowing economy, liquidity concerns, delayed monsoon leading to water shortage, rural
distress in some areas and high valuation as reflected in P/E are among the reasons behind the
recent underperformance of the Indian markets. The growth outlook for the economy has to
improve to attract FPI money and even domestic money. The cut in interest rates in the US
could trigger positive sentiment in global equities.In this edition, we are extremely glad to bring to you “Top 1000” special issue where a
comprehensive list of the top 1000 companies by market capitalisation is shared along with
their financials. To top it up, we have also shared a sectoral perspective on 24 sectors based on
the financials of the leading companies. Smart investors such as yourself can use this wealth of
data to ascertain which sectors are outperforming the others. I am sure that the YoY growth
data on several parameters shared in the Top 1000 issue will more than assist you in
ascertaining the underlying trend across
industries and make profitable investment
decisions.While a lot of investors found the budget to
be a non-event owing to lack of positive
announcements from the stock market point
of view, one statement made by the Finance
Minster caught the investors’ attention, i.e
“The promoter holdings in any listed
company shall not exceed 65 percent”! With
this announcement, we thought it will be
appropriate to analyse how many stocks will
be impacted if such a decision was to be
implemented. In our cover story, we have
done exactly that and much more. Have a
look at the cover story and take appropriate investment decisions. I hope you enjoy what you
read in the cover story.The current market situation warrants calmness. One will have to be ‘boringly consistent’ in
these markets to emerge victorious. Consistency, in terms of sticking to quality stocks, is what I
mean here and showing patience and holding on to quality (stocks) is what can be boring for
many. So, the mantra is to remain boringly consistent while participating in the current
market. Follow the basics of investment as there is no room for flexing muscles in the current
market environment.Stay tuned as we promise to keep you abreast with the ever-changing market sentiment!
V B PADODE
Editor-in-Chief