BUDGET SPECIAL
T
he Indian investing story is a
good one. But for naysayers,
there is always trouble round the
corner with good news. Stock market
indices are touching record highs with
the Sensex breaching the 36,000 mark
and the broader Nifty going past the
11,000 mark. The stock market gains
have been consistent over the past few
years and not a surge in recent months.
There is more to cheer with the Economic
Survey predicting 7-7.5% growth in the
coming year. And, by the time you read
this, the Budget announcements would
have left its share of impact on the stock
markets and economy for the positive.
The optimists that most stock market
watchers are, it seems like a never
ending rise.
But the trouble with good news is that
many a time one mistakes the image
for content, but we are in times when it
is almost impossible to argue why the
stock market can’t be 50 per cent higher.
The state of the world economy puts
India under the spotlight as an attractive
investment destination. FII inflows are
strong, there is ample participation
by domestic institutions and retail
investors going by the deployment by
mutual funds, interest rates are low and
corporate performance is good. There
is political stability, little to worry about
global uncertainties and until recently a
very stable and low oil price.equities all the way
Top stocks’ valuations are still competitive
against past market highs, there is more
retail money is flowing into equities and
both domestic and global players have
economic confidence in India. But this
is India, and the land that gave the rest
of the world instant karma also carries
its share of uncertain outcomes, just
the way the Indian cricket team, whichis ranked at the top of rankings fared in
South Africa. Yet, investors and traders
are minting money, making it easy to
ignore problems that might otherwise
have been highlighted earlier. Thanks
to stringent regulations, there is no talk
of suspicious or hot money finding its
way into the Indian markets, with the
FIIs brought under vigil by the market
regulator.
The IPO market is very well regulated
and transparent, making it extremely
difficult for price manipulation or
allotment exploitation. Both the leading
bourses have the necessary systems in
place to ensure safety with good trading,
settlement and regulatory system which
guarantees the quality of your investing
experience. At current market levels,
investors can at least exit profitably or
de-risk their portfolios. But it’s important
to know what these risks are, and how
to avoid them. We will come to that later.Has investing ever looked so great? Investment is still coming in and India
is a hot story. But there are a few things you need to worry about
the Market is on Fire
66 12 FEBRUaRy 2018