We suggested India Sensex/Nifty can NOT go very high above 21000/6300 in next few months. Some of our friends argued why? They asked us to argue our case with Nifty data and weight of sectors. So, We attach weight of defensive sectors in India Nifty (source: nseindia.com)
See weight of domestic slowdown proof sectors or defensives - FMCG,IT/Pharma and premium private sector Banks in Nifty. We note FMCG has 13.03%, IT/Pharma 17.58% and premium private sector Banks 16.16% so total slowdown proof sectors compose 46.77%. Rest all sectors domestic Infra/Commodity/Auto/PSU Banks etc. consists of rest 53% of Nifty.
In this situation we find it very difficult to believe Nifty can go very very high say 8000 or say Nifty can go down very very low say 3000 in next few months as suggested by lot of people. Current composition suggests we are unfortunately going to be in tight broad range of 4500-6300 because when IT/Pharma exports grow due to strong US economy and India's rural consumption drive FMCG due to good monsoon our local sectors will take good time to catch up due to policy paralysis/scam related news etc we saw in 2011 and 2012.
However, We feel we can definitely start journey of crossing 6300 decisively after few (12-15??) months because US economy could become growth engine of world and India's great strength in IT and upcoming Pharma/generics/agrochemicals out-sourcing boom will make sure Nifty go places :-).
Note: This is our personal view and we could be 100% wrong. Please do not make any decision based on what we have written above but make your own judgement.
See weight of domestic slowdown proof sectors or defensives - FMCG,IT/Pharma and premium private sector Banks in Nifty. We note FMCG has 13.03%, IT/Pharma 17.58% and premium private sector Banks 16.16% so total slowdown proof sectors compose 46.77%. Rest all sectors domestic Infra/Commodity/Auto/PSU Banks etc. consists of rest 53% of Nifty.
In this situation we find it very difficult to believe Nifty can go very very high say 8000 or say Nifty can go down very very low say 3000 in next few months as suggested by lot of people. Current composition suggests we are unfortunately going to be in tight broad range of 4500-6300 because when IT/Pharma exports grow due to strong US economy and India's rural consumption drive FMCG due to good monsoon our local sectors will take good time to catch up due to policy paralysis/scam related news etc we saw in 2011 and 2012.
However, We feel we can definitely start journey of crossing 6300 decisively after few (12-15??) months because US economy could become growth engine of world and India's great strength in IT and upcoming Pharma/generics/agrochemicals out-sourcing boom will make sure Nifty go places :-).
Note: This is our personal view and we could be 100% wrong. Please do not make any decision based on what we have written above but make your own judgement.
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1 comment:
Quite the contrary - the new U.S regime is in favor of imposing restrictions on outsourcing and off-shoring of jobs.
So there is likely to be restrictions on outsourcing of IT and import of pharma from foreign countries.
Must remember that "Jobs" are a hot potato in U.S politics and the current elections would be fought and lost/won on basis of Jobs situation.
As of right now the dice is evenly loaded with no candidate having a remarkable edge as per latest opinion polls.
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