'Question is whether the 2012 rally has fizzled out'

Last Updated: Thu, Mar 01, 2012 19:52 hrs

The markets, in a correction mode, reacted to various macro economic factors like rising crude prices and slowing economic growth, during the past week. According to data released in the past few days, economic growth slowed in the December quarter to its weakest annual pace in almost three years. The fund managers of Smart Portfolios’ Season 4 comment on the markets and their individual portfolios.

For the week, Rikesh Parikh’s net worth stands at Rs 1,024,000, up 2.36 per cent; Ashish Mittal’s net worth is at Rs 1,049,000, up 4.89 per cent; Alex Mathews’ net worth is at Rs 1,067,000, up 6.71 per cent; and Ajay Parmar’s net worth totals Rs 1,122,000, up 12.16 per cent.

VP (equity strategies), Motilal Oswal Securities
“Markets, after a run up, had given their first weekly negative closing and I have been on the sideline after that steep run-up. I would be a buyer in the markets in case of a dip below 5300 levels,” stated Parikh, commenting on his investment strategy. He added he would like to double his exposure in his current holdings.

Parikh’s top holding as of now include, Cadila Healthcare, Mahindra & Mahindra, Pidlite Industries, Bharti Airtel and Power Grid Corporation of India.

RIKESH PARIKH, VP Equity Strategies, Motilal Oswal Securities
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
Cadila Healthcare 716.94 710.90 0.46
Mahindra & Mahindra 701.00 681.75 0.41
Pidlite Industries 144.72 151.25 0.38
Bharti Airtel 347.57 346.30 0.35
Power Grid Corp of India 101.93 112.50 0.34
Total investments     3.36
Cash      6.88
Net worth     10.24

Fund Manager (PMS), Centrum Wealth
Commenting on the markets, Mittal said, “In just 35 trading days - between January 1, 2012 and February 21, 2012 - the Sensex recovered fast and went up by 19 per cent. From that level, the domestic equity markets have witnessed some correction.

The question in the mind of investors now is whether the 2012 rally in the domestic markets has fizzled out because of about nine per cent rise in crude oil prices (Nymex variety) in the month of February, the impending UP election results and its consequent impact on the Union government.”

In Mittal’s opinion, across the world, appreciation of local currency and reversal of benchmark rates have always played a major role in rallies in domestic equity markets. It happened in a big way in Japan, Taiwan and in India itself, post-Lehman crisis. “Markets went up from the bottom by over 100% after the rupee again started appreciating,” he commented. Mittal expects these trends to once again play a significant positive role in the current year. He also expects the market indices to remain buoyant throughout the year.

ASHISH MITTAL, Fund Manager – PMS, Centrum Wealth
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
Balmer Lawrie & Company 618.48 547.05 0.71
MRF 6816.10 9757.55 0.68
Karur Vysya Bank 372.59 375.85 0.64
Bharat Electronics 1582.70 1593.55 0.64
Tide Water Oil Co 6751.40 7381.15 0.59
Total investments     9.80
Cash      0.69
Net worth     10.49

His top holdings currently include Balmer Lawrie & Company, MRF, Karur Vysya Bank, Bharat Electronics and Tide Water Oil Co.

Head (technical and derivatives research), Geojit BNP Paribas Financial Services
During the week, Mathews exited some of his stocks and took fresh positions in non-index stocks with good valuations. “I will continue to hold on to stocks like Lovable, RIL, HDIL, Venkey’s India,” he said, commenting on his portfolio. He also acquired exposure in IT stocks like TCS, Oracle Finance and Infosys. “I expect crude to remain strong as long as tensions in Iran are alive and so I have opened a position in Cairn India as well,” Mathews added.

Oracle Financial Services, Infosys, Cairn India, Tata Consultancy Services and Den Networks are his current top holdings.

ALEX MATHEWS, Head-Technical and Derivatives Research, Geojit BNP Paribas Financial Services
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
Oracle Financial Services  2456.07 2684.20 1.07
Infosys 2956.07 2856.65 0.94
Cairn India 386.71 376.90 0.94
TCS 1250.07 1219.60 0.92
Den Networks 105.46 102.80 0.51
Total Investments     5.63
Cash     5.04
Net worth     10.67

Co-head (investment banking), Emkay Global
Parmar has taken up positions in real estate and infrastructure stocks, expecting good returns. He commented, “In terms of my portfolio, I remain underweight. I have churned my portfolio during the past week and my quantum remains almost the same, compared to the previous weeks.” Parmar added he remains positive on banking stocks, too. His current top holdings include IRB Infrastructure Developers, Bajaj Auto, Allahabad Bank, Indiabulls Power and Insecticides India.

AJAY PARMAR, Co-head, Investment Banking, Emkay Global
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
IRB Infrastructure Developers 189.47 178.45 0.36
Bajaj Auto 1521.09 1774.20 0.36
Allahabad Bank 189.92 190.40 0.34
Indiabulls Power 16.49 16.90 0.34
Insecticides India 407.02 411.35 0.31
Total investments     3.33
Cash      7.88
Net worth     11.22

For Smart Portfolios please visit www.smartinvestor.business-standard.com

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