In this special edition of ‘Bulls Charge Ahead’, Sunil Singhania, founder of Abakkus Asset Management, talks about the festive joy on Dalal Street as the market hits record highs.
Singhania said, “The past 18 months have been phenomenal. We started off with a lot of scares, but I think all’s well that ends well. As we speak, there is a lot of optimism within the economy and also the markets. After managing public money for such a long time, you have learned the lesson that managing expectations is always very important. So I think what we’re taking at this time is to continue to be optimistic. “
Regarding alpha generation in this market, Singhania said, “If you see the markets have undergone a transformation. The last four or five years has been a time when only a few stocks and a handful of sectors have sort of given you returns, the rest of the sectors just get overlooked. I think investors have realized that the economy and the markets are not just made up of a few stocks, but there are also a lot of other sectors and stocks that can do very well. If you actually see the movement of the markets over the past 6-12 months, these are the overlooked sectors, which investors have found to keep making good profits, they continue to generate good cash flow, and these are the stocks and sectors where there is a huge undervaluation relative to the market.
“There are still opportunities to be seized, we envision growth for Nifty over two years, ie fiscal 22 and 23, or 50% more than 21 on a cumulative basis. This is a low base factor for FY21, as it is for many other performing sectors. I would say earnings growth will come mostly from metals and sectors related to the economy, maybe even banks. “
For a full interview, watch the accompanying video …
(Edited by : Aditi Gautam)
First publication: STI