USDINR closed at 54.93 (close on Jan 04, 2013). We haven't posted monthly chart of Rupee since long so we attach it below.
If we read above chart of Rupee against Dollar we think Dollar will be stronger over next 18-24 months against Rupee. This is because in spite of Reforms push and end of policy paralysis by Government, Improvement in sentiment and huge $23-$24 Billion Inflow by Foreign Investors in Indian markets in 2012 Rupee has hardly seen any strength and USDINR is just 4.2% below its all time high. Sometime in first half of 2013 once we start getting news flow about unresolved global issues - Europe/Iran/Syria etc. coupled with India's Current Account Deficit we may see next move by USDINR to cross 2012 highs. This is one of the reasons we think export oriented companies (pharma/engineering/textiles) to do well up to 2016.
However, Over next 4-5 months of 2013 we are bullish on Rupee and we expect USDINR to touch 52-51 which is in sync with our Nifty target of 6300 and Defty target of 4200 in first half of 2013.
Disc: We could be 100% wrong in above view. Please do not make any decision based on what we have written here.
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2 comments:
Hi Jigs,
Nice post. Noted your comments on three export led sectors. What do you think will happen to domestic consumption sectors like banking, retail, infrastructure and so on, during the period till 2016.
Thanks,
Kumar
Kumar,
We are 15-18 months away from a point where interest rates can go down meaningfully. So, consumer related stocks may do well up to 2015 which is in sync with my 4 year cycle uptrend of sector theory - 2011-2015. Though I do not suggest companies with marketcap quoting at 3-4-5 times sales but companies with reasonable market cap to sales e.g. Coromandel International OR Jubilant Industries. Disc: I/firm/clients hold.
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